Humana Inc (HUM)
Liquidity ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Current ratio | 1.76 | 1.59 | 0.29 | 0.22 | 0.35 |
| Quick ratio | 1.21 | 1.13 | 1.10 | 1.08 | 1.29 |
| Cash ratio | 1.21 | 1.13 | 1.10 | 1.08 | 1.29 |
The current ratio, which measures the company's ability to cover its short-term liabilities with its current assets, has shown significant improvement over the years. In December 2020, the current ratio was only 0.35, indicating that the company had limited liquid assets to cover its current obligations. However, by December 2024, the current ratio had increased to a healthy 1.76, reflecting a substantial improvement in liquidity.
Similarly, the quick ratio, also known as the acid-test ratio, provides a more stringent measure of liquidity by excluding inventory from current assets. Humana Inc's quick ratio has remained relatively stable over the years, ranging from 1.08 to 1.21. This suggests that the company has a solid ability to meet its short-term obligations using only its most liquid assets.
The cash ratio, which specifically assesses the company's ability to cover its current liabilities with cash and cash equivalents, also shows consistent stability over the years, ranging from 1.08 to 1.21. This indicates that Humana Inc maintains a strong cash position to meet its immediate payment obligations.
Overall, based on the liquidity ratios provided, Humana Inc has shown significant improvement in its liquidity position over the years, with healthy current, quick, and cash ratios by the end of December 2024. This indicates the company's ability to efficiently manage its short-term financial obligations and maintain a strong liquidity position.
See also:
Additional liquidity measure
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
The cash conversion cycle of Humana Inc has consistently been 0.00 days from December 31, 2020, to December 31, 2024. A cash conversion cycle of 0.00 days indicates that the company is efficiently managing its cash flow, effectively converting its investments into cash to meet operational requirements, and then receiving cash from sales promptly. This indicates a streamlined process where the company is effectively managing its working capital, inventory, accounts receivable, and accounts payable. A lower cash conversion cycle is generally positive as it signifies better liquidity and efficiency in managing the company's cash resources. Humana Inc's ability to maintain a consistent 0.00 days cash conversion cycle over the years indicates a strong cash management strategy and operational efficiency.