Fair Isaac Corporation (FICO)

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	160,421	136,778	163,022	137,771	139,856	133,202	155,062	174,219	162,157	195,354	237,612	197,836	144,662	157,394	125,673	108,966	111,216	106,426	78,808	76,885
Short-term investments	US$ in thousands	-36,955	—	-32,047	—	—	—	—	—	—	—	—	30,437	28,455	25,513	—	—	—	—	—	—
Receivables	US$ in thousands	557,408	591,843	585,320	537,350	483,434	487,796	458,295	429,374	416,293	467,515	449,416	424,695	489,465	515,730	457,923	453,533	415,974	425,078	318,044	271,632
Total current liabilities	US$ in thousands	433,109	367,688	392,946	373,278	354,988	331,459	383,855	382,762	321,797	559,207	544,769	500,561	391,042	414,511	460,187	479,824	442,032	490,828	457,713	436,620
Quick ratio		1.57	1.98	1.82	1.81	1.76	1.87	1.60	1.58	1.80	1.19	1.26	1.30	1.69	1.69	1.27	1.17	1.19	1.08	0.87	0.80

December 31, 2023 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($160,421K + $-36,955K + $557,408K) ÷ $433,109K
= 1.57

The quick ratio, also known as the acid-test ratio, measures the ability of Fair, Isaac Corp. to meet its short-term liabilities using its most liquid assets. It is calculated by dividing the sum of cash, cash equivalents, and accounts receivable by the current liabilities.

Looking at the quick ratio over the past eight quarters, we observe some fluctuations. The quick ratio has generally remained above 1, indicating that Fair, Isaac Corp. has a comfortable level of liquid assets to cover its short-term obligations.

The quick ratio peaked at 1.51 in the quarter ending September 30, 2023, indicating a strong ability to meet short-term liabilities with liquid assets. This was followed by a slight decline to 1.46 in the subsequent quarter, which is still a healthy level. However, the quick ratio decreased further to 1.40 in the quarter ending March 31, 2023, before reaching 1.31 at the end of the period, which is the lowest in the given time frame. This downward trend raises some concerns about the company's ability to cover immediate financial obligations with its most liquid assets.

It's important to note that a quick ratio above 1 generally suggests that the company is able to meet its short-term liabilities without having to sell its inventory, which is a positive indicator of financial health. However, the downward trend in Fair, Isaac Corp.'s quick ratio should be monitored, as it could indicate potential challenges in maintaining liquidity in the short term. Further analysis of the company's cash flow and working capital management may provide additional insights into the reasons behind these fluctuations.