Hims Hers Health Inc (HIMS)
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 | 1.79 | 2.14 | 2.68 | 2.80 | 3.00 | 3.03 | 3.53 | 4.01 | 4.52 | 3.49 | 4.14 | 4.78 | 3.41 | 5.22 | 12.30 | 17.29 | 7.43 | 0.44 | 1.26 | 1.37 |
| Quick ratio | 1.38 | 1.66 | 2.09 | 2.18 | 2.57 | 2.57 | 2.90 | 3.28 | 3.83 | 2.97 | 3.51 | 4.19 | 3.17 | 4.81 | 11.60 | 16.43 | 6.65 | 19.88 | 1.19 | 1.27 |
| Cash ratio | 1.36 | 1.66 | 2.09 | 2.18 | 2.50 | 2.57 | 2.90 | 3.28 | 3.75 | 2.97 | 3.51 | 4.19 | 3.12 | 4.81 | 11.60 | 16.43 | 6.58 | 19.88 | 1.19 | 1.27 |
Hims Hers Health Inc's liquidity ratios show fluctuations over the years, indicating changes in the company's ability to meet its short-term obligations.
The current ratio, which measures the company's ability to pay its short-term liabilities with its short-term assets, improved significantly from December 2020 to March 2021 but has since decreased. Although the current ratio has generally remained above 1, suggesting the company can cover its current liabilities, the ratio has been declining, indicating a potential strain on liquidity in recent periods.
The quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, follows a similar trend, showing a decrease over the years. This ratio also highlights a decline in the company's ability to cover its short-term obligations with its most liquid assets.
The cash ratio, which is the most conservative liquidity ratio, focuses solely on cash and cash equivalents to cover short-term liabilities. This ratio has also experienced a downward trend, indicating a decrease in the company's ability to settle its current debts using only cash on hand.
Overall, while Hims Hers Health Inc has maintained liquidity above a critical level of 1 in most periods, the declining trend in all three liquidity ratios suggests a potential need for the company to assess and improve its liquidity management to ensure ongoing financial stability.
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 | -30.68 | -41.02 | -31.71 | -30.48 | -45.09 | -48.90 | -43.82 | -47.86 | -30.65 | -36.61 | -28.55 | -52.44 | -27.44 | -35.16 | -72.62 | -75.82 | -39.30 | 59.99 | 111.02 | 220.90 |
The cash conversion cycle of Hims Hers Health Inc has shown a significant improvement over time, indicating enhanced efficiency in managing its working capital.
Historically, the company had a relatively high cash conversion cycle, exceeding 200 days at the end of March 2020. However, as of December 2024, the cash conversion cycle has turned negative, implying that the company now receives cash from sales before having to pay suppliers, reflecting a more favorable position.
This trend suggests that Hims Hers Health Inc has been able to streamline its operations, reduce the time it takes to convert inventory into sales, collect receivables, and pay off its payables. Overall, a negative cash conversion cycle indicates improved liquidity and working capital management, potentially leading to better financial health and increased profitability for the company.