Home Depot Inc (HD)
Quick ratio
| Jan 28, 2024 | Oct 29, 2023 | Jul 30, 2023 | Apr 30, 2023 | Jan 29, 2023 | Oct 30, 2022 | Jul 31, 2022 | May 1, 2022 | Jan 30, 2022 | Oct 31, 2021 | Aug 1, 2021 | May 2, 2021 | Jan 31, 2021 | Nov 1, 2020 | Aug 2, 2020 | May 3, 2020 | Feb 2, 2020 | Nov 3, 2019 | Aug 4, 2019 | May 5, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 3,760,000 | 2,058,000 | 2,814,000 | 1,260,000 | 2,757,000 | 2,462,000 | 1,259,000 | 2,844,000 | 2,343,000 | 5,067,000 | 4,566,000 | 6,648,000 | 7,895,000 | 14,652,000 | 14,139,000 | 8,696,000 | 2,133,000 | 2,193,000 | 2,547,000 | 1,882,000 |
| Short-term investments | US$ in thousands | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Receivables | US$ in thousands | 3,328,000 | 3,932,000 | 3,836,000 | 4,213,000 | 3,317,000 | 3,732,000 | 3,725,000 | — | 3,426,000 | 3,533,000 | — | — | 2,992,000 | — | — | — | — | — | — | — |
| Total current liabilities | US$ in thousands | 22,015,000 | 23,572,000 | 24,227,000 | 25,446,000 | 23,110,000 | 24,280,000 | 27,834,000 | 30,387,000 | 28,693,000 | 26,903,000 | 26,666,000 | 27,758,000 | 23,166,000 | 25,395,000 | 24,199,000 | 23,348,000 | 18,375,000 | 19,565,000 | 18,798,000 | 19,673,000 |
| Quick ratio | 0.32 | 0.25 | 0.27 | 0.22 | 0.26 | 0.26 | 0.18 | 0.09 | 0.20 | 0.32 | 0.17 | 0.24 | 0.47 | 0.58 | 0.58 | 0.37 | 0.12 | 0.11 | 0.14 | 0.10 |
January 28, 2024 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($3,760,000K
+ $—K
+ $3,328,000K)
÷ $22,015,000K
= 0.32
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 quick ratio below 1 indicates that a company may have difficulty meeting its short-term liabilities.
Analyzing Home Depot Inc's quick ratio over the past few quarters, we observe fluctuations in the ratio. The quick ratio stood at 0.32 on January 28, 2024, indicating that the company had $0.32 of liquid assets available to cover each dollar of current liabilities. This suggests a relatively lower liquidity position.
The quick ratio has shown volatility in recent quarters, ranging from a low of 0.09 on May 1, 2022, to a high of 0.58 on two occasions - November 1, 2020, and August 2, 2020. The substantial variation in the quick ratio may signal changes in Home Depot's liquidity management or the nature of its current assets and liabilities.
Overall, a low quick ratio may indicate potential liquidity challenges for Home Depot Inc, especially if expenses or liabilities suddenly increase, and the company may need to rely on other sources of liquidity such as borrowing or asset sales to meet its short-term obligations. Monitoring this ratio closely in conjunction with other liquidity metrics is essential to assessing the company's financial health and ability to weather short-term financial challenges.
Peer comparison
Jan 28, 2024