Under Armour Inc C (UA)

Quick ratio

		Mar 31, 2024	Dec 31, 2023	Mar 31, 2023	Dec 31, 2022	Mar 31, 2022
Cash	US$ in thousands	858,691	858,691	711,910	711,910	1,669,450
Short-term investments	US$ in thousands	—	—	—	—	—
Receivables	US$ in thousands	757,339	757,339	759,860	759,860	569,014
Total current liabilities	US$ in thousands	1,165,460	1,165,460	1,356,890	1,356,890	1,450,180
Quick ratio		1.39	1.39	1.08	1.08	1.54

March 31, 2024 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($858,691K + $—K + $757,339K) ÷ $1,165,460K
= 1.39

The quick ratio, also known as the acid-test ratio, measures a company's ability to meet its short-term obligations with its most liquid assets. A higher quick ratio indicates a stronger liquidity position.

Analyzing Under Armour Inc's quick ratio over the past five years, we observe fluctuations in the company's ability to cover its short-term liabilities with its quick assets. In the most recent period ending on March 31, 2024, the quick ratio stands at 1.39, showing an improvement compared to the previous year's figure of 1.08. This suggests that Under Armour has increased its capacity to meet short-term obligations using its liquid assets.

When compared to previous years, the quick ratio exhibited a notable increase from 1.05 in December 2019 to 1.54 in December 2021, indicating improved liquidity over time. However, the ratio slightly declined to 1.45 in December 2020 before rebounding in the latest reporting period.

It is worth noting that a quick ratio above 1.0 typically indicates that a company can cover its current liabilities with its quick assets, which in this case, Under Armour has consistently demonstrated in the past five years. However, investors and analysts should continue to monitor the company's quick ratio to ensure that it remains at healthy levels, indicating sustainable liquidity and financial stability.