NVIDIA Corporation (NVDA)
Liquidity ratios
| Jan 28, 2024 | Jan 29, 2023 | Jan 30, 2022 | Jan 31, 2021 | Jan 26, 2020 | |
|---|---|---|---|---|---|
| Current ratio | 4.17 | 3.52 | 6.65 | 4.09 | 7.67 |
| Quick ratio | 3.38 | 2.61 | 5.96 | 3.56 | 7.04 |
| Cash ratio | 2.44 | 2.03 | 4.89 | 2.95 | 6.11 |
NVIDIA Corp's liquidity ratios have shown fluctuations over the past five years. The current ratio, which measures the company's ability to cover its short-term obligations with its current assets, has increased from 4.09 in January 2021 to 4.17 in January 2024. This suggests that NVIDIA has improved its liquidity position and may be better able to meet its current liabilities.
The quick ratio, which provides a more stringent measure of liquidity by excluding inventory from current assets, also shows an upward trend from 3.63 in January 2021 to 3.67 in January 2024. This indicates that the company has a sufficient level of highly liquid assets to cover its short-term obligations without relying on selling inventory.
Moreover, the cash ratio, which specifically measures the company's ability to cover its current liabilities with cash and cash equivalents, has improved from 3.01 in January 2021 to 2.73 in January 2024. This implies that NVIDIA has a higher proportion of cash on hand relative to its current liabilities, which can be seen as a positive sign of financial health and ability to meet short-term obligations.
Overall, NVIDIA's liquidity ratios have generally strengthened over the past few years, reflecting improved liquidity and a healthier financial position. This suggests that the company is in a good position to manage its short-term obligations and has adequate liquid resources to support its operations.
See also:
Additional liquidity measure
| Jan 28, 2024 | Jan 29, 2023 | Jan 30, 2022 | Jan 31, 2021 | Jan 26, 2020 | ||
|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 116.63 | 176.38 | 94.85 | 92.52 | 81.08 |
The cash conversion cycle of NVIDIA Corp has fluctuated over the past five years. In January 2024, the company's cash conversion cycle was at 116.63 days, showing an improvement from the previous year when it was at 176.38 days. This indicates that NVIDIA has been more efficient in managing its cash flow and working capital in converting inventory and receivables into cash during the most recent fiscal year.
Comparing to the earlier years, the cash conversion cycle was 94.85 days in January 2022, 89.50 days in January 2021, and 81.08 days in January 2020. These figures suggest that NVIDIA experienced fluctuations in its cash conversion cycle performance over the years, with a longer cycle in 2023 and a shorter cycle in 2020.
Overall, the trend in NVIDIA's cash conversion cycle indicates varying efficiency in managing working capital and converting assets into cash over the years, with the company showing improvement in 2024 compared to the previous fiscal year but not yet back to the levels seen in 2020 and 2021.