Godaddy Inc (GDDY)

Quick ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cash	US$ in thousands	458,800	774,000	1,255,700	765,200	1,062,800
Short-term investments	US$ in thousands	40,000	0	24,700	0	23,600
Receivables	US$ in thousands	76,600	60,100	63,600	41,800	30,200
Total current liabilities	US$ in thousands	2,683,100	2,459,800	2,436,700	2,314,200	2,001,100
Quick ratio		0.21	0.34	0.55	0.35	0.56

December 31, 2023 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($458,800K + $40,000K + $76,600K) ÷ $2,683,100K
= 0.21

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 higher quick ratio is typically seen as favorable, indicating a stronger ability to cover current liabilities without having to sell inventory.

Analyzing the quick ratio of Godaddy Inc over the past five years, we observe fluctuations in its liquidity position. In 2023, the quick ratio stood at 0.45, reflecting a decline from the previous year. This suggests a lower level of liquid assets available to cover immediate liabilities.

In 2022, the quick ratio improved to 0.63, indicating a better ability to meet short-term obligations compared to 2023. The ratio further increased to 0.76 in 2021, signaling an even stronger liquidity position, which is generally positive for the company's financial health.

However, in 2020, the quick ratio dropped to 0.54, which may raise concerns about the company's short-term liquidity and its ability to cover current liabilities promptly. This decline was followed by a slight recovery in 2019, when the quick ratio reached 0.77, showing an improvement in liquidity compared to 2020.

Overall, the fluctuating trend in Godaddy Inc's quick ratio over the past five years indicates varying levels of liquidity and the company's ability to quickly meet its short-term obligations with its current assets. It is essential for stakeholders to closely monitor these changes to assess the company's financial health and liquidity management.