Dynatrace Holdings LLC (DT)

Based on the provided data for Dynatrace Holdings LLC's liquidity ratios over the past five years, we can observe the following trends:

1. Current Ratio: The current ratio measures the company's ability to meet its short-term obligations with its current assets. Dynatrace's current ratio has been relatively stable over the past five years, ranging from 1.00 to 1.28. This indicates that the company has generally been able to cover its short-term liabilities with its current assets, with the ratio improving slightly in 2024 compared to previous years.

2. Quick Ratio: The quick ratio, also known as the acid-test ratio, provides a more stringent measure of liquidity by excluding inventory from current assets. Dynatrace's quick ratio has also shown a similar trend to the current ratio, ranging from 0.85 to 1.15 over the past five years. The quick ratio improved in 2024 compared to previous years, indicating a stronger ability to meet short-term obligations without relying on inventory.

3. Cash Ratio: The cash ratio measures the company's ability to cover its current liabilities with cash and cash equivalents alone. Dynatrace's cash ratio has shown a consistent improvement over the past five years, increasing from 0.43 in 2020 to 0.66 in 2024. This suggests that the company has been progressively enhancing its ability to meet short-term obligations purely with cash on hand.

Overall, the liquidity ratios of Dynatrace Holdings LLC indicate a generally stable and improving liquidity position over the past five years. The company has managed to strengthen its ability to meet short-term obligations, with notable improvements in the quick ratio and cash ratio in 2024 compared to previous years. These trends suggest that Dynatrace has been effectively managing its liquidity and maintaining a healthy financial position.

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Additional liquidity measure

The cash conversion cycle of Dynatrace Holdings LLC has shown a fluctuating trend over the past five years. The cycle improved in the most recent fiscal year, standing at 144.64 days compared to 166.80 days in the prior year. This indicates that the company has become more efficient in converting its resources into cash.

Although there was an improvement in the cash conversion cycle in the latest year, it is worth noting that the cycle had increased steadily from 2020 to 2022 before reversing the trend in 2023 and 2024. This fluctuation may suggest varying levels of efficiency in managing the company's cash flows and operating cycle during these periods.

Overall, while the recent improvement is a positive sign for Dynatrace Holdings LLC, it would be essential for the company to continue monitoring and managing its cash conversion cycle effectively to ensure sustained operational efficiency and financial stability.