Guidewire Software Inc (GWRE)

Quick ratio

Oct 31, 2024 Jul 31, 2024 Apr 30, 2024 Jan 31, 2024 Oct 31, 2023 Jul 31, 2023 Apr 30, 2023 Jan 31, 2023 Oct 31, 2022 Jul 31, 2022 Apr 30, 2022 Jan 31, 2022 Oct 31, 2021 Jul 31, 2021 Apr 30, 2021 Jan 31, 2021 Oct 31, 2020 Jul 31, 2020 Apr 30, 2020 Jan 31, 2020
Cash US$ in thousands 823,562 547,992 359,600 349,989 301,419 401,813 266,615 274,899 263,163 606,303 326,861 257,378 239,620 384,910 284,448 331,387 293,836 366,969 293,815 218,463
Short-term investments US$ in thousands 514,767 455,576 422,691 427,634 411,528 396,872 421,202 439,833 442,023 369,865 481,086 562,753 602,162 734,517 803,885 814,845 856,376 766,527 740,386 836,939
Receivables US$ in thousands 97,475 137,339 104,344 128,242 93,083 151,034 129,068 127,627 88,273 143,797 85,703 111,705 80,407 104,068 71,785 92,581 78,295 114,242 79,587 101,171
Total current liabilities US$ in thousands 615,237 837,635 704,807 307,076 262,375 373,261 275,428 275,209 252,764 337,518 237,098 231,151 204,165 300,314 214,297 210,723 185,623 225,198 176,717 182,586
Quick ratio 2.33 1.36 1.26 2.95 3.07 2.54 2.97 3.06 3.14 3.32 3.77 4.03 4.52 4.07 5.41 5.88 6.62 5.54 6.30 6.33

October 31, 2024 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($823,562K + $514,767K + $97,475K) ÷ $615,237K
= 2.33

Guidewire Software Inc's quick ratio has shown a gradual decline over the past few years. The quick ratio stood at a healthy 6.33 as of January 31, 2020, indicating a strong ability to meet short-term obligations with liquid assets. However, this ratio decreased to 2.95 as of January 31, 2024, which may suggest a potential liquidity concern.

The quick ratio further deteriorated to 1.26 as of April 30, 2024, and then improved slightly to 2.33 on October 31, 2024. Although there was an uptick in the quick ratio from April 2024 to October 2024, the ratio remains relatively low compared to historical levels.

A quick ratio below 1 indicates that the company may have difficulty meeting its short-term obligations with its most liquid assets. Given the downward trend observed in the quick ratio, it's essential for Guidewire Software Inc to closely monitor its liquidity position and take appropriate measures to strengthen its ability to meet short-term financial obligations.