eBay Inc (EBAY)
Liquidity ratios
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 1.24 | 1.25 | 1.25 | 1.99 | 2.44 | 2.16 | 2.45 | 2.68 | 2.18 | 1.33 | 1.28 | 1.48 | 1.97 | 3.35 | 3.96 | 1.30 | 1.80 | 1.75 | 1.58 | 1.34 |
| Quick ratio | 0.97 | 0.87 | 0.93 | 1.57 | 1.99 | 1.82 | 2.01 | 2.14 | 1.75 | 0.88 | 0.81 | 1.12 | 1.58 | 2.75 | 3.40 | 0.66 | 0.96 | 0.95 | 1.13 | 0.95 |
| Cash ratio | 0.97 | 0.87 | 0.93 | 1.57 | 1.99 | 1.82 | 2.01 | 2.14 | 1.75 | 0.88 | 0.81 | 1.12 | 1.58 | 2.75 | 3.40 | 0.66 | 0.96 | 0.95 | 1.13 | 0.95 |
eBay Inc's liquidity ratios, such as the current ratio, quick ratio, and cash ratio, provide insights into the company's ability to meet its short-term obligations.
1. Current Ratio: The current ratio measures eBay's ability to cover its short-term liabilities with its current assets. The ratio has fluctuated over the years, ranging from a low of 1.28 in June 2022 to a high of 3.96 in June 2021. As of December 31, 2024, the current ratio stood at 1.24, indicating that eBay may have some challenges in meeting its short-term obligations using current assets.
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. eBay's quick ratio has also shown variability, with a low of 0.81 in June 2022 and a high of 3.40 in June 2021. As of December 31, 2024, the quick ratio was 0.97, suggesting that eBay may face difficulty in meeting its short-term obligations without relying on inventory.
3. Cash Ratio: The cash ratio specifically focuses on eBay's ability to cover short-term liabilities using its cash and cash equivalents alone. Similar to the other liquidity ratios, the cash ratio has fluctuated over the years. As of December 31, 2024, the cash ratio was 0.97, indicating that eBay may have a limited ability to cover its short-term obligations solely with cash reserves.
In conclusion, eBay's liquidity ratios have shown variability over the years, with some periods indicating stronger liquidity positions than others. It is important for eBay to maintain a balance between current assets and current liabilities to ensure it can meet its short-term financial commitments efficiently.
See also:
Additional liquidity measure
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 0.00 | 23.55 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 212.40 | 206.61 | 190.56 | 202.72 | 198.99 | 0.00 | 0.00 |
The cash conversion cycle is a key financial metric that measures how efficiently a company manages its working capital. For eBay Inc, the cash conversion cycle has shown significant fluctuations over the analyzed periods.
The cycle was at a relatively low level for most of the periods, indicating efficient management of cash, inventory, and receivables. However, there were spikes in the cycle during September 2020, December 2020, March 2021, and June 2021, which reached as high as 212.40 days. These spikes suggest potential challenges in managing cash flows, inventory turnover, and collection of receivables during these periods.
It is worth noting that there was a significant improvement in the cash conversion cycle by the end of September 2024, with the cycle decreasing to 23.55 days. This improvement indicates a positive trend in managing working capital efficiently.
Overall, the analysis of eBay Inc's cash conversion cycle suggests that the company has generally been effective in managing its working capital, with periodic challenges that have required attention to maintain efficiency in cash, inventory, and receivables management.