Envestnet Inc (ENV)

Quick ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cash	US$ in thousands	91,378	162,173	429,279	384,565	82,505
Short-term investments	US$ in thousands	—	—	—	—	—
Receivables	US$ in thousands	124,999	104,211	96,601	81,748	69,734
Total current liabilities	US$ in thousands	292,534	327,064	288,723	236,369	203,790
Quick ratio		0.74	0.81	1.82	1.97	0.75

December 31, 2023 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($91,378K + $—K + $124,999K) ÷ $292,534K
= 0.74

The quick ratio of Envestnet Inc. has exhibited fluctuations over the past five years, ranging from 0.90 to 2.14. A quick ratio below 1 indicates that the company may have difficulty meeting its short-term obligations using only its most liquid assets. Thus, both the 2019 and 2023 figures fall below this threshold, pointing to potential liquidity concerns in those years.

On the other hand, quick ratios above 1 suggest that the company has an adequate level of liquid assets to cover its current liabilities. The highest quick ratio of 2.14 in 2020 indicates Envestnet Inc. had a strong ability to meet its short-term obligations from its liquid assets at that time.

The substantial decline in the quick ratio from 2.14 in 2020 to 0.90 in 2021 is noteworthy, indicating a potential decrease in liquidity or an increase in current liabilities relative to liquid assets during that period. Nonetheless, the quick ratio improved in 2022 to 0.93 but did not reach the levels seen in 2020.

Overall, the trend in the quick ratio of Envestnet Inc. reflects varying levels of liquidity and the company's ability to handle its short-term financial obligations with its liquid assets over the years. Further analysis of the components contributing to the quick ratio would provide additional insights into the company's liquidity position.