Certara Inc (CERT)

Certara Inc's liquidity ratios have shown fluctuations over the years. The current ratio, a measure of short-term liquidity, decreased from 4.60 in 2020 to 2.13 in 2024. This suggests a potential decrease in the company's ability to cover its short-term obligations with its current assets.

The quick ratio, which provides a more stringent assessment of liquidity by excluding inventories, decreased from 3.60 in 2020 to 1.23 in 2024. This indicates a declining ability to meet short-term obligations without relying on inventory.

The cash ratio, the most conservative liquidity measure, also decreased over the years from 3.60 in 2020 to 1.23 in 2024. This implies a reduction in Certara Inc's ability to cover its current liabilities with only its cash and cash equivalents.

Overall, the declining trend in all three liquidity ratios raises concerns about Certara Inc's short-term liquidity position. It is important for the company to closely monitor its liquidity and take appropriate measures to ensure it can meet its obligations as they come due.

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Additional liquidity measure

Certara Inc's cash conversion cycle has shown fluctuation over the years. In December 2020, the company had a cash conversion cycle of 6.91 days, which decreased to 2.70 days by December 2021, indicating an improvement in the company's efficiency in converting its investments in inventory and accounts receivable into cash.

However, by December 2022, the cash conversion cycle increased significantly to 8.54 days, suggesting that Certara Inc took longer to convert its resources into cash during that period. The subsequent years, December 2023 and 2024, reported a cash conversion cycle of 0.00 days, which could indicate a potential change in the company's operations or reporting practices.

Overall, it is essential for Certara Inc to monitor and manage its cash conversion cycle effectively to ensure optimal cash flow management and operational efficiency in the future.