ZoomInfo Technologies Inc. (GTM)
Quick ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 139,900 | 447,100 | 418,000 | 308,300 | 269,800 |
| Short-term investments | US$ in thousands | 82,200 | 82,200 | 127,700 | 18,400 | 30,600 |
| Receivables | US$ in thousands | 257,500 | 272,000 | 234,200 | 190,700 | 123,600 |
| Total current liabilities | US$ in thousands | 652,100 | 638,400 | 572,700 | 507,600 | 320,800 |
| Quick ratio | 0.74 | 1.26 | 1.36 | 1.02 | 1.32 |
December 31, 2024 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($139,900K
+ $82,200K
+ $257,500K)
÷ $652,100K
= 0.74
The analysis of ZoomInfo Technologies Inc.'s quick ratio over the reported period reveals notable fluctuations that reflect changes in the company's liquidity position. As of December 31, 2020, the quick ratio was 1.32, indicating that the company's quick assets slightly exceeded its current liabilities, thus suggesting a comfortable liquidity position at that time.
By December 31, 2021, the quick ratio decreased to 1.02, approaching a more balanced state, but still remaining above 1.0. This decline may imply a reduction in liquid assets relative to current liabilities, potentially indicating increased reliance on less liquid current assets or a shift in asset composition.
In the subsequent year, December 31, 2022, the quick ratio increased again to 1.36, surpassing the previous year's level and reinforcing an improved liquidity buffer. This rise could result from an increase in quick assets such as cash and accounts receivable, or a reduction in current liabilities.
However, the ratio experienced a decline by December 31, 2023, to 1.26, signaling a slight weakening of liquidity compared to the previous year but still maintaining a ratio above 1.0, which generally indicates sufficient short-term liquidity to meet immediate obligations.
The most notable change occurs by December 31, 2024, when the quick ratio drops sharply to 0.74. This value falling below 1.0 suggests a potential liquidity concern, as quick assets are now insufficient to cover current liabilities without resorting to inventory or non-liquid assets. The decline may reflect increased current liabilities, a decrease in liquid assets, or both, and warrants further investigation into the underlying causes, such as changes in receivables, cash holdings, or short-term debt levels.
Overall, the trend indicates that while ZoomInfo maintained a generally healthy quick ratio in the earlier years with values above 1.0, recent fiscal periods have seen a decline, culminating in a ratio that signals reduced liquidity cushion in 2024. This downward trend warrants careful monitoring to assess the company's ability to meet short-term liabilities promptly and to evaluate the factors contributing to the erosion in liquidity position.
Peer comparison
Dec 31, 2024