Match Group Inc (MTCH)

Match Group Inc's liquidity ratios have shown some fluctuation over the past few years. The current ratio, which measures the company's ability to pay off its short-term liabilities with its current assets, has generally been above 1, indicating good liquidity. However, it decreased significantly in June 2020 but has since improved and stabilized around 1.5 to 2.5, showing that the company has sufficient current assets to cover its short-term obligations.

The quick ratio, also known as the acid-test ratio, provides a more stringent measure of liquidity by excluding inventory from current assets. Match Group Inc's quick ratio has also shown fluctuations but has generally remained above 1, indicating the company's ability to meet its short-term liabilities without relying on selling inventory. The ratio has improved over time and has been consistently above 1.5 since December 2022, further strengthening the company's liquidity position.

The cash ratio, which is the most conservative liquidity ratio as it only considers cash and cash equivalents, mirrors the trend of the quick ratio. Match Group Inc's cash ratio has generally been above 1, indicating a strong ability to cover short-term liabilities with cash on hand. The company has maintained a healthy cash position, with the ratio consistently improving over the years, demonstrating a solid liquidity position.

In conclusion, Match Group Inc's liquidity ratios suggest that the company has managed its short-term financial obligations effectively and has maintained a strong liquidity position over the analyzed period. The improving trend in the quick and cash ratios indicates that the company has been able to increase its ability to meet short-term obligations without relying on inventory or other current assets.

---

Additional liquidity measure

Match Group Inc's cash conversion cycle is a measure that indicates the amount of time it takes for the company to convert its investments in inventory and other resources into cash flows from sales. A shorter cash conversion cycle is generally favorable as it implies that the company is efficient in managing its working capital.

Based on the data provided, Match Group Inc's cash conversion cycle was 0.00 days for most of the quarters between March 2020 and March 2023. This indicates that during these periods, the company was able to effectively manage its inventory, accounts receivable, and accounts payable to quickly convert its investments into cash.

However, there were two periods where the cash conversion cycle increased significantly. In December 2020, the cash conversion cycle was 47.16 days, and in December 2021, it rose to 52.49 days. These increases may suggest that Match Group Inc faced challenges in efficiently managing its working capital during these specific quarters, leading to a delay in converting investments into cash flow from sales.

From March 2024 onwards, the cash conversion cycle returned to 0.00 days, indicating a more efficient management of working capital. Overall, while the company experienced temporary challenges in its cash conversion cycle during certain periods, its ability to quickly convert investments into cash improved in the subsequent quarters.