Fortinet Inc (FTNT)

Liquidity ratios

Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Current ratio 1.47 1.19 1.24 1.55 1.50
Quick ratio 1.00 0.66 0.72 1.10 1.00
Cash ratio 1.00 0.66 0.72 1.10 1.00

Fortinet Inc's liquidity ratios provide insights into the company's ability to meet its short-term financial obligations.

1. Current Ratio:
- The current ratio measures the company's ability to cover its short-term liabilities with its current assets.
- Fortinet Inc has shown a relatively stable current ratio over the years, ranging from 1.19 to 1.55.
- A current ratio above 1 indicates that Fortinet Inc has more current assets than current liabilities, providing some comfort regarding short-term solvency.

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.
- Fortinet Inc's quick ratio fluctuates between 0.66 and 1.10, showing some variability in its ability to cover short-term liabilities without relying on inventory.
- A quick ratio above 1 implies that the company has sufficient liquid assets to meet immediate obligations, although the lower values in some years suggest a tighter liquidity position.

3. Cash Ratio:
- The cash ratio is the most conservative liquidity measure as it focuses solely on cash and cash equivalents to cover short-term liabilities.
- Fortinet Inc's cash ratio mirrors its quick ratio trends, ranging from 0.66 to 1.10, with a similar dip in certain years.
- A cash ratio of 1 indicates that the company could pay off all current liabilities using only cash and cash equivalents, highlighting its ability to weather short-term financial challenges.

Overall, the analysis of Fortinet Inc's liquidity ratios suggests that the company has generally maintained a sound liquidity position over the years, with a few fluctuations that may warrant further monitoring to ensure continued financial stability.


See also:

Fortinet Inc Liquidity Ratios


Additional liquidity measure

Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Cash conversion cycle days 99.48 143.03 89.02 81.95 89.52

The cash conversion cycle of Fortinet Inc has shown some fluctuations over the years.

In 2020, the company had a cash conversion cycle of 89.52 days, indicating that it took approximately 89.52 days for the company to convert its investments in inventory and other resources into cash inflows.

By 2021, the cash conversion cycle improved to 81.95 days, suggesting that the company managed its working capital more effectively and reduced the time taken to convert its resources into cash.

However, in 2022, the cash conversion cycle increased slightly to 89.02 days, which may indicate potential challenges in managing working capital efficiently during that period.

In 2023, there was a significant spike in the cash conversion cycle to 143.03 days, possibly indicating difficulties in managing operating cash flows and working capital requirements.

Subsequently, in 2024, the cash conversion cycle decreased to 99.48 days, demonstrating some improvement in the company's ability to efficiently convert its resources into cash inflows.

Overall, the trend in the cash conversion cycle of Fortinet Inc has shown some variability over the years, with fluctuations reflecting changes in the company's operational efficiency and working capital management practices.