Liveramp Holdings Inc (RAMP)

Liveramp Holdings Inc's liquidity ratios have shown a consistent trend of decline over the years. The current ratio decreased from 5.00 in March 31, 2021, to 2.78 in March 31, 2024, indicating a reduction in the company's ability to cover its short-term obligations with current assets. This decreasing trend may raise concerns about the company's liquidity position and ability to meet its short-term liabilities.

Similarly, the quick ratio also exhibited a declining trend, decreasing from 4.66 in March 31, 2021, to 2.62 in March 31, 2024. The quick ratio provides a more stringent measure of liquidity as it excludes inventories from current assets. The decreasing quick ratio suggests that Liveramp Holdings Inc may face challenges in meeting its short-term obligations without relying on inventory liquidation.

Moreover, the cash ratio declined from 3.51 in March 31, 2021, to 1.70 in March 31, 2024. The cash ratio is the most conservative measure of liquidity, as it only considers cash and cash equivalents to cover current liabilities. The declining cash ratio indicates that Liveramp Holdings Inc's ability to meet short-term obligations solely based on its readily available cash resources has weakened over the years.

In summary, the decreasing trend in Liveramp Holdings Inc's liquidity ratios, including the current ratio, quick ratio, and cash ratio, suggests a potential deterioration in the company's ability to meet its short-term financial obligations. Investors and stakeholders may need to monitor the company's liquidity position closely to assess any potential risks associated with its ability to manage short-term liquidity needs effectively.

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Additional liquidity measure

The cash conversion cycle of Liveramp Holdings Inc has shown significant improvement over the years. As of March 31, 2021, the company had a cash conversion cycle of 77.03 days, indicating that it takes around 77 days to convert its investments in inventory and other resources into cash inflows from sales.

However, by March 31, 2025, Liveramp Holdings Inc managed to achieve a cash conversion cycle of 0 days, signifying that the company was able to efficiently convert its investments into cash without encountering any delays or inefficiencies.

The negative cash conversion cycle figures in the intermediate years (2022 to 2024) suggest that Liveramp Holdings Inc was able to optimize its working capital management and streamline its operations to the point where it was able to convert its resources into cash inflows before paying off its liabilities.

Overall, the trend in Liveramp Holdings Inc's cash conversion cycle indicates a commendable improvement in operational efficiency and liquidity management over the years, reflecting positively on the company's financial health and ability to generate cash flows.