Grid Dynamics Holdings Inc (GDYN)
Liquidity ratios
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 7.62 | 5.96 | 7.14 | 7.48 | 7.67 | 6.21 | 6.01 | 6.55 | 8.35 | 10.09 | 5.39 | 6.32 | 7.61 | 9.95 | 4.27 | 7.05 | 10.11 | 18.96 | 18.98 | 14.85 |
| Quick ratio | 6.03 | 4.26 | 5.53 | 5.78 | 6.09 | 4.84 | 4.60 | 5.13 | 6.63 | 8.07 | 3.89 | 4.69 | 5.70 | 8.23 | 2.70 | 5.56 | 8.47 | 16.23 | 16.27 | 35.36 |
| Cash ratio | 6.03 | 4.26 | 5.53 | 5.78 | 6.09 | 4.84 | 4.60 | 5.13 | 6.63 | 8.07 | 3.89 | 4.69 | 5.70 | 8.23 | 2.70 | 5.56 | 8.47 | 16.23 | 16.27 | 35.36 |
Grid Dynamics Holdings Inc's liquidity ratios show a trend of fluctuation over the years.
1. Current Ratio: The current ratio, which measures the company's ability to cover short-term liabilities with its current assets, has generally been very high, indicating strong liquidity. However, there has been a declining trend from 18.98 in June 2020 to 5.96 in September 2024. The ratio peaked at 18.96 in September 2020 but has since been on a downward trajectory, suggesting a potential decrease in the company's ability to meet its short-term obligations.
2. Quick Ratio: The quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, shows a similar declining trend from 16.27 in June 2020 to 4.26 in September 2024. The company's ability to cover its short-term liabilities without relying on inventory has decreased over the years.
3. Cash Ratio: The cash ratio, which is the most conservative liquidity ratio focusing only on cash and cash equivalents, also displays a decreasing trend from 16.27 in June 2020 to 4.26 in September 2024. This indicates a potential weakening in the company's ability to meet its short-term obligations using only its cash reserves.
Overall, the liquidity ratios of Grid Dynamics Holdings Inc suggest a diminishing ability to meet short-term obligations with its current assets and cash equivalents over the years. This trend may raise concerns about the company's short-term financial stability and capability to address immediate financial needs.
Additional liquidity measure
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 26.80 | 29.75 | 21.97 | 0.00 | 17.38 | 0.00 | 11.59 | 1.73 | 2.48 | 4.52 | 3.80 | 4.30 | 5.80 | 4.56 | 1.67 |
The cash conversion cycle of Grid Dynamics Holdings Inc has shown fluctuations over the analyzed periods. In March 2020, the company had a relatively short cash conversion cycle of 1.67 days, indicating efficient management of cash, inventory, and receivables. However, by September 2020, the cycle had extended to 5.80 days, suggesting a delay in converting sales into cash.
From December 2020 to June 2021, there was some improvement in the cash conversion cycle, hovering around 4 days. Subsequently, in September 2021, the cycle decreased significantly to 2.48 days, indicating improved efficiency in converting working capital into cash.
Interestingly, in March and June 2022, the cash conversion cycle dropped to 0 days, potentially indicating that the company was operating with negative working capital during these periods. This could be due to efficient management of payables and receivables.
However, in the following quarters, the cash conversion cycle increased significantly, reaching peaks of 29.75 days in June 2023 and 26.80 days in September 2023. These longer cycles may suggest challenges in managing working capital efficiently, potentially impacting liquidity and cash flow.
In December 2023 and March 2024, the cash conversion cycle returned to 0 days, potentially indicating operational improvements or changes in the company's working capital management strategies. It's essential for Grid Dynamics Holdings Inc to monitor and manage its cash conversion cycle effectively to ensure optimal cash flow and liquidity management.