DocuSign Inc (DOCU)

Liquidity ratios

	Jan 31, 2025	Oct 31, 2024	Jul 31, 2024	Apr 30, 2024	Jan 31, 2024	Oct 31, 2023	Jul 31, 2023	Apr 30, 2023	Jan 31, 2023	Oct 31, 2022	Jul 31, 2022	Apr 30, 2022	Jan 31, 2022	Oct 31, 2021	Jul 31, 2021	Apr 30, 2021	Jan 31, 2021	Oct 31, 2020	Jul 31, 2020	Apr 30, 2020
Current ratio	0.81	0.83	0.84	0.93	0.94	0.93	0.88	0.82	0.74	1.02	1.01	1.01	0.96	0.96	0.98	1.01	1.06	1.01	1.13	1.43
Quick ratio	0.76	0.78	0.78	0.87	0.89	0.89	0.83	0.77	0.70	0.96	0.95	0.94	0.91	0.89	0.92	0.94	1.00	0.93	1.05	1.34
Cash ratio	0.53	0.59	0.58	0.68	0.63	0.73	0.65	0.59	0.47	0.67	0.71	0.72	0.59	0.65	0.68	0.71	0.71	0.65	0.79	1.04

DocuSign Inc's liquidity ratios have shown fluctuations over the analyzed periods. The current ratio, which measures the company's ability to cover its short-term obligations with its current assets, has decreased from 1.43 on April 30, 2020, to 0.81 on January 31, 2025. This downward trend indicates a potential weakening in the company's liquidity position over time.

The quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, has also followed a similar downward trend, declining from 1.34 on April 30, 2020, to 0.76 on January 31, 2025. This suggests that DocuSign Inc may be facing challenges in meeting its short-term obligations with its most liquid assets.

Furthermore, the cash ratio, which indicates the company's ability to cover its current liabilities with its cash and cash equivalents, has exhibited a fluctuating pattern, ranging from 1.04 on April 30, 2020, to 0.53 on January 31, 2025. This variability in the cash ratio highlights potential volatility in the company's cash position over the analyzed periods.

Overall, the decreasing trends in the current ratio, quick ratio, and cash ratio indicate a potential liquidity risk for DocuSign Inc, emphasizing the importance of closely monitoring its ability to meet its short-term financial obligations with available liquid assets.

Additional liquidity measure

		Jan 31, 2025	Oct 31, 2024	Jul 31, 2024	Apr 30, 2024	Jan 31, 2024	Oct 31, 2023	Jul 31, 2023	Apr 30, 2023	Jan 31, 2023	Oct 31, 2022	Jul 31, 2022	Apr 30, 2022	Jan 31, 2022	Oct 31, 2021	Jul 31, 2021	Apr 30, 2021	Jan 31, 2021	Oct 31, 2020	Jul 31, 2020	Apr 30, 2020
Cash conversion cycle	days	47.60	34.68	38.27	36.92	55.06	46.23	56.22	55.33	71.03	55.31	45.07	44.45	66.00	47.87	51.86	54.63	75.06	66.12	62.01	71.17

The cash conversion cycle (CCC) is a measure of the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales. A lower CCC indicates efficient management of working capital, as the company can quickly convert its resources into cash.

Analyzing DocuSign Inc's CCC data from April 30, 2020, to January 31, 2025, we observe fluctuations in the cycle duration. The CCC decreased from 71.17 days on April 30, 2020, to 34.68 days on October 31, 2024, before increasing slightly to 47.60 days on January 31, 2025.

The significant decrease in the CCC from 71.17 days on April 30, 2020, to 34.68 days on October 31, 2024, indicates improvements in managing working capital efficiency. This may suggest streamlined operations, optimized inventory management, and accelerated cash flow conversion.

However, the slight increase in the CCC to 47.60 days on January 31, 2025, might indicate potential challenges in maintaining the efficiency achieved in the prior period. It could be due to changes in sales patterns, inventory management issues, or delays in receivables collections.

Overall, DocuSign Inc's CCC trend reflects a mix of efficiency gains and potential areas for improvement in working capital management. Further monitoring and analysis of the company's operational performance and cash flow dynamics will be essential to sustain or enhance working capital efficiency in the future.