Biogen Inc (BIIB)
Liquidity ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Current ratio | 1.35 | 2.00 | 2.99 | 1.83 | 1.84 |
| Quick ratio | 0.72 | 0.91 | 2.26 | 1.49 | 1.21 |
| Cash ratio | 0.46 | 0.43 | 1.74 | 1.13 | 0.70 |
Biogen Inc's liquidity has shown varying trends over the years based on its key ratios. The current ratio, which measures the company's ability to cover short-term liabilities with its current assets, has generally been healthy, with a slight decrease from 2020 to 2021, followed by a substantial increase in 2022, before declining again in 2023 and 2024. In particular, the current ratio improved significantly in 2022, indicating a stronger short-term liquidity position compared to the previous years.
The quick ratio, a more stringent measure that excludes inventory from current assets, has also displayed fluctuations. It showed an improvement from 2020 to 2021, indicating a better ability to meet immediate obligations without relying on inventory. However, there was a significant decrease in the quick ratio in 2023 and 2024, suggesting a potential decrease in the company's ability to cover short-term liabilities with its most liquid assets.
The cash ratio, which is the most conservative liquidity measure focusing solely on cash and cash equivalents, exhibited a mixed performance. There was a notable increase from 2020 to 2021, reflecting a stronger capacity to meet obligations with cash on hand. However, the cash ratio decreased substantially in 2023 before a slight recovery in 2024.
Overall, the liquidity ratios of Biogen Inc indicate a generally stable liquidity position, with some fluctuations in specific years. It is important for the company to monitor these ratios closely to ensure it maintains sufficient liquidity to meet its short-term obligations effectively.
See also:
Additional liquidity measure
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 197.85 | 201.64 | 122.70 | 100.61 | 176.04 |
The cash conversion cycle of Biogen Inc has shown fluctuations over the past five years. In December 2020, the company had a cash conversion cycle of 176.04 days, indicating that it took Biogen approximately 176 days to convert its investments in inventory and other resources into cash from sales.
By December 2021, the cash conversion cycle decreased to 100.61 days, suggesting a more efficient management of inventory and accounts receivable, leading to a quicker conversion of resources into cash.
In December 2022, the cash conversion cycle increased slightly to 122.70 days, indicating a longer period to convert investments into cash compared to the previous year.
However, in December 2023, there was a notable increase in the cash conversion cycle to 201.64 days, signifying a significant delay in the conversion of resources into cash, which may indicate potential inefficiencies in managing working capital.
By December 2024, the cash conversion cycle decreased slightly to 197.85 days, still remaining at a relatively higher level compared to previous years. Overall, the trend in the cash conversion cycle of Biogen Inc shows some variability, with potential implications for the company's working capital management and operational efficiency.