HealthStream Inc (HSTM)
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 | 1.32 | 1.32 | 1.24 | 1.17 | 1.10 | 1.11 | 1.08 | 1.03 | 0.98 | 0.99 | 0.91 | 0.94 | 1.06 | 1.10 | 1.04 | 0.98 | 0.96 | 2.10 | 2.15 | 1.96 |
| Quick ratio | 0.84 | 0.86 | 0.74 | 0.66 | 0.60 | 0.63 | 0.51 | 0.48 | 0.46 | 0.49 | 0.37 | 0.40 | 0.52 | 0.59 | 0.52 | 0.48 | 0.39 | 1.58 | 1.56 | 1.39 |
| Cash ratio | 0.84 | 0.86 | 0.74 | 0.66 | 0.60 | 0.63 | 0.51 | 0.48 | 0.46 | 0.49 | 0.37 | 0.40 | 0.52 | 0.59 | 0.52 | 0.48 | 0.39 | 1.58 | 1.56 | 1.39 |
HealthStream Inc's liquidity ratios show fluctuations over the past few years. The current ratio, which measures the company's ability to pay its short-term liabilities with its current assets, increased from March 2020 to June 2022, indicating improved liquidity. However, it declined thereafter but remained above 1, suggesting the company can meet its current obligations.
The quick ratio, a more stringent measure of liquidity excluding inventory from current assets, followed a similar trend as the current ratio, showing an initial increase followed by a decrease from March 2023 onwards. The quick ratio also stayed above 1 until December 2024, implying the company could cover its short-term debts without relying on inventory.
The cash ratio, which is the most conservative liquidity measure as it only considers cash and cash equivalents, showed a pattern analogous to the quick ratio, remaining above 0.5 throughout the period under review. This indicates that HealthStream Inc maintained a solid cash position relative to its current liabilities.
Overall, while HealthStream Inc's liquidity ratios fluctuated, they generally reflected adequate liquidity levels, enabling the company to meet its short-term financial obligations.
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 | 0.00 | 45.36 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
HealthStream Inc's cash conversion cycle, as reflected in the provided data, has been consistently low or even zero over the past several quarters, indicating efficient management of cash flow and working capital. The cash conversion cycle measures the time it takes for a company to convert its investments in inventory and other resources into cash inflows from sales.
The fact that the cash conversion cycle is close to zero or very low suggests that HealthStream Inc is able to quickly convert its resources and inventory investments into cash through its operational activities. This efficiency in managing the cash conversion cycle can be beneficial for the company as it implies that there is minimal delay in receiving cash from its operations.
However, it's worth noting that in the data for September 30, 2024, the cash conversion cycle increased to 45.36 days, which is a significant deviation from the previous quarters. This increase might indicate a delay in the conversion of investments into cash during that period, which could have been influenced by various factors such as changes in sales patterns, inventory management issues, or payment terms with suppliers or customers.
Overall, while the consistent low or zero cash conversion cycle reflects HealthStream Inc's effective management of cash flow and working capital, the notable increase in the cycle for September 30, 2024, warrants further investigation to understand the factors contributing to this deviation. Monitoring the cash conversion cycle can provide insights into the company's operational efficiency and effectiveness in managing its cash resources.