Privia Health Group Inc (PRVA)

Based on the provided data, Privia Health Group Inc's liquidity ratios demonstrate a mixed trend over the years:

1. Current Ratio:
- The current ratio measures the company's ability to meet its short-term obligations with its current assets.
- Privia Health Group Inc's current ratio improved from 1.29 in 2020 to 2.35 in 2021, indicating a significant increase in the company's short-term liquidity position.
- However, the ratio then declined to 2.09 in 2022, further dropping to 1.81 in 2023, and slightly recovering to 1.86 in 2024.
- Although the current ratio has fluctuated, the values above 1 suggest that Privia Health Group Inc generally has more current assets than current liabilities to meet its short-term financial obligations.

2. Quick Ratio:
- The quick ratio, also known as the acid-test ratio, provides a more stringent measure of liquidity by excluding inventories from current assets.
- Privia Health Group Inc's quick ratio was relatively low at 0.58 in 2020, indicating a dependency on inventory to meet short-term obligations.
- However, the quick ratio improved significantly to 1.68 in 2021, demonstrating a stronger ability to cover immediate liabilities with liquid assets.
- The ratio further improved in 2022 and 2024 to 1.32 and 1.09, respectively, but dropped to 1.01 in 2023.
- Overall, the increasing trend in the quick ratio suggests a better liquidity position for Privia Health Group Inc over the years.

3. Cash Ratio:
- The cash ratio is the most conservative measure of liquidity, focusing solely on the ability to cover current liabilities with cash and cash equivalents.
- Privia Health Group Inc's cash ratio mirrored the quick ratio values, starting at 0.58 in 2020 and improving significantly to 1.68 in 2021.
- Similarly, the cash ratio dropped to 1.01 in 2023 but showed a slight recovery to 1.09 in 2024.
- The cash ratio values indicate that Privia Health Group Inc has maintained healthy levels of cash and cash equivalents to meet its immediate financial obligations.

In conclusion, despite some fluctuations, Privia Health Group Inc's liquidity ratios generally depict an improving trend over the years, with stronger liquidity positions indicated by the higher current, quick, and cash ratios in more recent years.

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Additional liquidity measure

Based on the data provided, Privia Health Group Inc has consistently maintained a cash conversion cycle of 0.00 days from December 31, 2020, to December 31, 2024. This indicates that the company is efficiently managing its cash flows, indicating a streamlined process of converting its resources into cash. A cash conversion cycle of 0.00 days suggests that the company is able to convert its investment in inventory into cash quickly, without facing delays in receiving payments from customers. This efficiency in managing working capital may positively impact the liquidity and financial health of Privia Health Group Inc.