Hims Hers Health Inc (HIMS)
Quick ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 220,584 | 96,663 | 46,772 | 71,784 | 27,344 |
| Short-term investments | US$ in thousands | 79,667 | 124,318 | 132,900 | 175,500 | 72,864 |
| Receivables | US$ in thousands | 6,100 | 6,700 | 3,900 | 4,100 | 1,100 |
| Total current liabilities | US$ in thousands | 221,367 | 88,468 | 47,941 | 79,221 | 15,228 |
| Quick ratio | 1.38 | 2.57 | 3.83 | 3.17 | 6.65 |
December 31, 2024 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($220,584K
+ $79,667K
+ $6,100K)
÷ $221,367K
= 1.38
The quick ratio of Hims Hers Health Inc has shown a declining trend over the years. As of December 31, 2020, the quick ratio was at a high level of 6.65, indicating a strong ability to meet short-term liabilities with liquid assets. However, this ratio decreased to 3.17 by December 31, 2021, and further to 2.57 by December 31, 2023. This declining trend suggests a potential decrease in the company's ability to cover its current liabilities with its most liquid assets.
Despite the decline, the quick ratio improved slightly to 3.83 as of December 31, 2022, but then decreased notably to 1.38 by December 31, 2024. A quick ratio below 1 indicates that the company may have difficulties meeting its short-term obligations with its liquid assets alone.
In conclusion, the declining trend in the quick ratio of Hims Hers Health Inc raises concerns about its liquidity position and ability to cover short-term obligations. It is important for the company to closely monitor and manage its liquidity to ensure financial stability and meet its short-term commitments effectively.
Peer comparison
Dec 31, 2024