Booking Holdings Inc (BKNG)
Liquidity ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Current ratio | 1.31 | 1.28 | 1.86 | 2.10 | 3.56 |
| Quick ratio | 1.03 | 0.95 | 1.46 | 1.79 | 3.23 |
| Cash ratio | 1.03 | 0.95 | 1.46 | 1.79 | 3.23 |
Booking Holdings Inc's liquidity ratios have shown a declining trend over the past five years. The current ratio, which measures the company's ability to meet short-term obligations with its current assets, decreased from 3.56 in 2020 to 1.31 in 2024, indicating a reduction in the company's liquidity position.
Similarly, the quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, also declined from 3.23 in 2020 to 1.03 in 2024. This indicates that Booking Holdings Inc may be less capable of meeting its short-term liabilities with its most liquid assets.
The cash ratio, which is the most conservative measure of liquidity focusing only on cash and cash equivalents, followed a similar downward trend from 3.23 in 2020 to 1.03 in 2024. This suggests that the company's ability to pay off its immediate liabilities solely with cash has weakened over the years.
Overall, the declining trend in these liquidity ratios for Booking Holdings Inc raises concerns about its short-term financial health and ability to meet its obligations in a timely manner. Investors and stakeholders may view this as a red flag, signaling potential challenges in managing liquidity and working capital efficiently.
See also:
Additional liquidity measure
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 0.00 | 0.00 | 286.83 | 246.18 | 191.60 |
The cash conversion cycle of Booking Holdings Inc has fluctuated over the years.
In December 2020, the cash conversion cycle was 191.60 days, indicating that the company took approximately 191.60 days to convert its investments in inventory and accounts receivable into cash receipts.
By December 2021, the cash conversion cycle increased to 246.18 days, suggesting a lengthening of the time it takes for the company to receive cash from its operations after investing in inventory and accounts receivable.
In December 2022, the cash conversion cycle further extended to 286.83 days, indicating a trend of delayed cash receipts compared to the previous year.
Subsequently, in December 2023 and 2024, the cash conversion cycle was reported as 0.00 days. The sudden decrease in the cash conversion cycle to zero days may imply that the company has optimized its working capital management and improved its efficiency in converting investments into cash receipts.
Overall, the trend shows fluctuations in the cash conversion cycle, with significant variations observed over the years, likely influenced by changes in the company's operational processes, management of inventory, and accounts receivable.