Dolby Laboratories (DLB)
Quick ratio
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 745,364 | 620,127 | 1,225,380 | 1,071,880 | 797,210 |
| Short-term investments | US$ in thousands | 139,148 | 189,213 | 38,839 | 46,948 | 119,146 |
| Receivables | US$ in thousands | 412,645 | 350,493 | 330,109 | 242,440 | 246,315 |
| Total current liabilities | US$ in thousands | 422,226 | 277,518 | 315,717 | 267,109 | 306,853 |
| Quick ratio | 3.07 | 4.18 | 5.05 | 5.10 | 3.79 |
September 30, 2023 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($745,364K
+ $139,148K
+ $412,645K)
÷ $422,226K
= 3.07
The quick ratio, also known as the acid-test ratio, measures a company's ability to meet its short-term liabilities with its most liquid assets. A quick ratio above 1 indicates that a company has enough liquid assets to cover its short-term obligations.
Over the past five years, Dolby Laboratories' quick ratio has shown a declining trend from 2019 to 2023. The quick ratio decreased from 3.79 in 2019 to 3.07 in 2023. This downward trend may indicate a decrease in Dolby's ability to cover its short-term liabilities with its most liquid assets over the years.
Despite the declining trend, Dolby's quick ratio remains above 1 in all years, indicating that the company has had more than enough liquid assets to cover its short-term obligations. However, the decreasing trend suggests a potential liquidity concern that investors and creditors should monitor.
In summary, while Dolby Laboratories has maintained a quick ratio above 1 over the past five years, the declining trend raises concerns regarding the company's ability to meet its short-term obligations solely with its liquid assets. Further analysis of Dolby's liquidity management and cash flow trends may be necessary to assess its overall financial health and sustainability.
Peer comparison
Sep 30, 2023