Harmony Biosciences Holdings (HRMY)
Liquidity ratios
| 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 | ||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 2.75 | 4.12 | 4.90 | 4.90 | 5.07 | 3.56 | 4.91 | 4.96 | 5.29 | 5.05 | 5.59 | 5.32 | 1.95 | 7.87 |
| Quick ratio | 2.61 | 3.90 | 4.67 | 4.64 | 4.79 | 3.38 | 4.62 | 4.65 | 5.01 | 4.68 | 5.22 | 4.93 | 1.86 | 7.49 |
| Cash ratio | 2.16 | 3.30 | 3.99 | 4.03 | 4.10 | 2.87 | 3.86 | 3.97 | 4.36 | 3.98 | 4.36 | 4.22 | 1.70 | 6.98 |
The liquidity ratios of Harmony Biosciences Holdings Inc indicate its ability to meet short-term financial obligations.
The current ratio, a measure of short-term liquidity, has been consistently high over the past eight quarters, averaging around 4.5. This indicates that the company has more than enough current assets to cover its current liabilities, providing a strong buffer against potential liquidity issues.
The quick ratio, which excludes inventory from current assets, also reflects strong liquidity levels for Harmony Biosciences. The company's quick ratio has consistently mirrored the trend seen in the current ratio, staying above 4.0 each quarter. This suggests that the company can readily meet its short-term obligations using its most liquid assets.
The cash ratio, which is the most stringent measure of liquidity as it considers only cash and cash equivalents, demonstrates that Harmony Biosciences maintains a healthy cash position. With the cash ratio averaging around 3.7 over the past eight quarters, the company appears well-prepared to cover its immediate liabilities with cash on hand.
Overall, based on the liquidity ratios, Harmony Biosciences appears to have a robust financial position with ample liquidity to handle its short-term financial commitments.
Additional liquidity measure
| 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 35.97 | 46.65 | 46.78 | 39.55 | 48.37 | 43.58 | 53.02 | 43.94 | 53.38 | 52.37 | 55.06 |
The cash conversion cycle of Harmony Biosciences Holdings Inc has varied significantly over the past eight quarters, indicating fluctuations in the company's efficiency in managing its cash, inventory, and receivables.
In Q4 2023, the company's cash conversion cycle was the lowest at 9.26 days, reflecting an efficient cash management process compared to previous quarters. This suggests that Harmony Biosciences improved its ability to convert its resources into cash during this period.
However, in Q2 and Q3 2023, the cash conversion cycle was notably higher, standing at 40.17 days and 40.26 days, respectively. This indicates delayed cash inflows relative to cash outflows, possibly due to increased inventories or longer collection periods for receivables during these quarters.
Q4 2022 also exhibited a significantly high cash conversion cycle of 47.87 days, signifying inefficiencies in the company's working capital management during that period. The improvement seen in Q4 2023 compared to Q4 2022 suggests that Harmony Biosciences may have implemented strategies to enhance its cash conversion cycle.
Overall, the analysis of Harmony Biosciences Holdings Inc's cash conversion cycle demonstrates fluctuations in the company's operational efficiency and effectiveness in managing its cash flow and working capital over the past eight quarters. Monitoring and improving the cash conversion cycle can help the company optimize its cash resources and enhance its overall financial performance.