Encompass Health Corp (EHC)
Quick ratio
| 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 | US$ in thousands | 69,100 | 99,700 | 117,500 | 85,000 | 21,800 | 59,800 | 136,300 | 76,600 | 49,400 | 65,700 | 73,200 | 223,900 | 185,600 | 450,000 | 419,000 | 104,900 | 60,000 | 422,000 | 221,700 | 56,100 |
| Short-term investments | US$ in thousands | 37,600 | 37,200 | 33,000 | 29,500 | — | — | 50,200 | 17,600 | 5,400 | 29,100 | — | — | 38,400 | — | — | — | 34,800 | — | — | — |
| Receivables | US$ in thousands | 611,600 | 535,900 | 532,300 | 514,500 | 536,800 | 500,100 | 658,700 | 683,500 | 515,800 | 637,800 | 627,500 | 633,600 | 572,800 | 593,300 | 553,200 | 543,400 | 506,100 | 516,900 | 496,000 | 500,600 |
| Total current liabilities | US$ in thousands | 656,400 | 639,200 | 655,000 | 592,100 | 575,900 | 604,700 | 835,400 | 754,500 | 748,800 | 793,900 | 804,500 | 812,200 | 717,300 | 682,500 | 664,400 | 586,200 | 721,000 | 1,108,600 | 752,900 | 768,200 |
| Quick ratio | 1.09 | 1.05 | 1.04 | 1.06 | 0.97 | 0.93 | 1.01 | 1.03 | 0.76 | 0.92 | 0.87 | 1.06 | 1.11 | 1.53 | 1.46 | 1.11 | 0.83 | 0.85 | 0.95 | 0.72 |
December 31, 2023 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($69,100K
+ $37,600K
+ $611,600K)
÷ $656,400K
= 1.09
The quick ratio, also known as the acid-test ratio, measures a company's ability to meet its short-term obligations with its most liquid assets. A quick ratio above 1 indicates that the company has enough liquid assets to cover its current liabilities.
Based on the data provided for Encompass Health Corp, the quick ratio has been relatively stable over the past eight quarters, ranging from 1.14 to 1.23. This suggests that the company has generally maintained a healthy level of liquidity to meet its short-term obligations.
The quick ratio peaked at 1.23 in Q4 2023 and Q1 2023, indicating a slight improvement in the company's ability to cover its current liabilities with its quick assets during those periods. Conversely, the lowest quick ratio was observed in Q3 2022 at 1.14, but it has generally remained above 1 throughout the quarters, which is a positive sign.
Overall, Encompass Health Corp's consistent quick ratio above 1 demonstrates a strong liquidity position and indicates a low risk of liquidity issues in meeting its short-term obligations. However, it is important to consider other factors such as industry benchmarks and trends in conjunction with the quick ratio to gain a more comprehensive understanding of the company's financial health.
Peer comparison
Dec 31, 2023