United Therapeutics Corporation (UTHR)
Liquidity ratios
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 5.25 | 4.58 | 4.35 | 3.77 | 4.41 | 4.65 | 8.68 | 9.84 | 9.85 | 9.68 | 8.10 | 8.84 | 7.61 | 7.46 | 7.44 | 6.66 | 6.70 | 7.22 | 7.43 | 8.91 |
| Quick ratio | 4.43 | 3.81 | 3.57 | 3.15 | 3.72 | 6.63 | 12.70 | 8.82 | 8.27 | 8.28 | 6.80 | 7.75 | 6.32 | 6.25 | 6.32 | 5.73 | 5.68 | 6.10 | 6.12 | 7.45 |
| Cash ratio | 4.43 | 3.81 | 3.57 | 3.15 | 3.72 | 6.63 | 12.70 | 8.82 | 8.27 | 8.28 | 6.80 | 7.75 | 6.32 | 6.25 | 6.32 | 5.73 | 5.68 | 6.10 | 6.12 | 7.45 |
United Therapeutics Corporation has demonstrated strong liquidity over the reviewed periods based on its current ratio, which remained consistently above 1. This indicates the company's ability to cover its short-term obligations with its current assets. The current ratio peaked at 9.85 on December 31, 2022, and slightly decreased to 5.25 on December 31, 2024.
The quick ratio, which measures the company's ability to meet short-term obligations with its most liquid assets, also remained robust throughout the period. It started at 7.45 on March 31, 2020, and increased to 4.43 on December 31, 2024, remaining well above the ideal threshold of 1. This suggests that United Therapeutics Corporation has a strong ability to cover its short-term liabilities without relying on inventory.
In terms of the cash ratio, which provides insight into the company's ability to cover its current liabilities with cash and cash equivalents, United Therapeutics Corporation displayed a solid financial position. The cash ratio ranged from 5.68 on December 31, 2020, to 4.43 on December 31, 2024, reinforcing the company's ability to meet short-term obligations solely with its cash holdings.
Overall, the liquidity ratios of United Therapeutics Corporation reflect a strong financial position with sufficient resources to meet its short-term obligations across the reviewed periods.
Additional liquidity measure
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 186.09 | 175.67 | 170.74 | 157.76 | 158.47 | 157.05 | 179.97 | 213.66 | 250.37 | 260.71 | 278.32 | 256.72 | 279.49 | 287.66 | 275.74 | 312.47 | 292.07 | 314.24 | 294.69 | 300.09 |
United Therapeutics Corporation's cash conversion cycle has shown fluctuations over the past few years. The cycle measures the time it takes for the company to convert its investments in raw materials into cash flow from sales.
From March 31, 2020, to December 31, 2021, the trend was generally decreasing, indicating an improvement in the company's efficiency in managing its working capital. The cycle decreased from 300.09 days to 279.49 days during this period.
However, from March 31, 2022, to December 31, 2024, the trend shifted, showing an increase in the cash conversion cycle back to 186.09 days. This increase could be attributed to various factors such as changes in sales patterns, inventory management, or payment terms with suppliers and customers.
An analysis of the historical cash conversion cycle data can provide insights into the company's liquidity management and operational efficiency. United Therapeutics Corporation may benefit from further evaluating its working capital management strategies to optimize its cash conversion cycle and ensure a healthy cash flow position.