DaVita HealthCare Partners Inc (DVA)

Liquidity ratios

Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Current ratio 1.19 1.24 1.25 1.19 1.20 1.26 1.41 1.29 1.32 1.62 1.67 1.67 1.27 1.37 1.35 1.81 1.56 1.81 1.12 1.12
Quick ratio 1.08 1.14 1.14 1.10 1.14 1.20 1.35 1.20 1.23 1.53 1.55 1.53 1.15 1.28 1.33 1.71 1.46 1.76 1.08 0.36
Cash ratio 0.17 0.20 0.16 0.17 0.16 0.21 0.21 0.16 0.23 0.48 0.48 0.41 0.16 0.31 0.76 0.65 0.49 0.68 0.63 0.06

DaVita Inc's liquidity ratios over the past eight quarters show mixed results. The current ratio, which measures the company's ability to meet short-term obligations with its current assets, has ranged between 1.19 and 1.41, with a general downward trend evident from the highest point in Q2 2022 to the lowest point in Q4 2023. While the current ratio has stayed above 1, indicating that DaVita Inc has, on average, enough current assets to cover its current liabilities, the declining trend raises some concerns about potential liquidity challenges in the future.

The quick ratio, a more stringent measure of liquidity that excludes inventories from current assets, has followed a similar pattern to the current ratio, ranging between 1.10 and 1.32. Despite the fluctuations, the quick ratio has generally stayed above 1, which suggests that DaVita Inc could meet its short-term obligations using its most liquid assets. However, the decreasing trend in the quick ratio over the quarters also warrants attention as it may indicate increasing reliance on less liquid assets to cover short-term liabilities.

The cash ratio, which indicates DaVita Inc's ability to cover immediate liabilities with cash and cash equivalents, has ranged from 0.15 to 0.22 over the same period. The company's cash ratio has fluctuated without a clear trend, which implies that DaVita Inc may not always have sufficient cash on hand to meet its most immediate obligations. An upward trend in the cash ratio would be preferable for ensuring better liquidity management.

Overall, DaVita Inc's liquidity ratios show a mixed picture with some cause for concern regarding the declining trend in the current and quick ratios. Management should closely monitor these ratios and take appropriate actions to maintain a healthy level of liquidity to meet its short-term financial obligations.

Additional liquidity measure

Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Cash conversion cycle days 12.26 18.72 20.69 16.06 15.39 21.90 26.92 15.98 18.40 20.52 27.72 35.72 10.96 21.82 26.23 26.34 13.31 31.64 24.02 27.45

The cash conversion cycle of DaVita Inc has shown a decreasing trend over the past quarters, from 80.19 days in Q4 2022 to 72.64 days in Q4 2023. This indicates an improvement in the company's efficiency in managing its cash flows and working capital.

The company has been able to reduce the time it takes to convert its investments in inventory into cash, which is a positive sign as it shows a more streamlined inventory management process. Additionally, DaVita Inc has been able to collect cash from its customers more quickly, suggesting effective accounts receivable management.

Overall, the decreasing trend in the cash conversion cycle demonstrates DaVita Inc's ability to efficiently utilize its resources and convert them into cash, which is essential for sustaining and growing its operations in the long term.