Gen Digital Inc. (GEN)

Gen Digital Inc.'s liquidity ratios have shown fluctuating trends over the years. The current ratio, which measures the company's ability to cover short-term liabilities with its current assets, has shown a declining trend from 0.72 in 2021 to 0.51 in 2024, indicating potential liquidity concerns. However, there is missing data for 2025, making it difficult to assess the most recent liquidity position.

The quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, also exhibited a decreasing trend from 0.51 in 2021 to 0.23 in 2024. This suggests that Gen Digital Inc. may have difficulties meeting its short-term obligations with its most liquid assets.

The cash ratio, which focuses solely on cash and cash equivalents to cover short-term liabilities, showed fluctuations over the years, with a peak of 0.62 in 2022 and a low of 0.17 in 2024. This indicates some volatility in the company's ability to meet immediate payment obligations using cash on hand.

In conclusion, Gen Digital Inc.'s liquidity ratios paint a picture of potential liquidity challenges, as indicated by the declining trends in the current and quick ratios. It would be crucial for the company to closely monitor its liquidity position and implement strategies to strengthen its ability to meet short-term financial obligations.

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Additional liquidity measure

Gen Digital Inc.'s cash conversion cycle has shown significant improvement over the years. As of March 31, 2021, the company had a cash conversion cycle of 203.68 days, indicating that it took over 6 months to convert its investments in raw materials into cash receipts from customers.

However, by March 31, 2022, Gen Digital Inc. managed to substantially reduce its cash conversion cycle to 12.93 days, suggesting a more efficient management of its working capital and quicker conversion of inventory and receivables into cash.

Moreover, as of March 31, 2023, the company further optimized its operations, achieving a negative cash conversion cycle of -10.14 days. This negative figure implies that Gen Digital Inc. was able to collect cash from customers before paying its suppliers, which can be a favorable sign of effective cash flow management.

By March 31, 2024, Gen Digital Inc. continued to enhance its cash conversion cycle efficiency, recording a lower -16.85 days. This trend indicates the company's ability to generate cash quickly within its operating cycle.

Lastly, as of March 31, 2025, the cash conversion cycle reached 0.00 days. This suggests that Gen Digital Inc. was able to achieve a balance where the time it took to convert its investments into cash equaled the time it took to pay off its liabilities.

Overall, the decreasing trend in the cash conversion cycle from 203.68 days to 0.00 days indicates improved working capital management and operational efficiency within Gen Digital Inc. This may signal that the company has been successful in streamlining its processes, enhancing cash flow, and optimizing its liquidity position.