VeriSign Inc (VRSN)
Liquidity ratios
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 0.83 | 0.86 | 0.87 | 0.92 | 0.93 | 0.96 | 1.00 | 1.16 | 1.18 | 1.21 | 1.19 | 1.22 | 1.23 | 1.23 | 1.23 | 1.24 | 1.32 | 1.35 | 1.39 | 1.40 |
| Quick ratio | 0.79 | 0.81 | 0.83 | 0.87 | 0.89 | 0.91 | 0.95 | 1.12 | 1.13 | 1.16 | 1.14 | 1.18 | 1.19 | 1.19 | 1.19 | 1.21 | 1.29 | 1.30 | 1.33 | 1.35 |
| Cash ratio | 0.78 | 0.81 | 0.82 | 0.87 | 0.88 | 0.90 | 0.94 | 1.12 | 1.13 | 1.15 | 1.13 | 1.18 | 1.19 | 1.19 | 1.18 | 1.20 | 1.27 | 1.29 | 1.32 | 1.34 |
The current ratio, quick ratio, and cash ratio are commonly used liquidity ratios to assess a company's ability to meet its short-term obligations.
Verisign Inc.'s current ratio has been declining over the past few quarters, from 1.16 in Q1 2022 to 0.83 in Q4 2023. This downward trend indicates a weakening ability to cover its short-term liabilities with its current assets. A current ratio below 1 suggests that the company may have difficulty meeting its current obligations.
Similarly, the quick ratio, which excludes inventory from current assets, also shows a declining trend from 1.16 in Q1 2022 to 0.83 in Q4 2023. This indicates that Verisign Inc. may have limited ability to cover its short-term liabilities with its most liquid assets.
The cash ratio, which is the most conservative measure of liquidity, also reveals a downward trend from 1.16 in Q1 2022 to 0.82 in Q4 2023. A cash ratio below 1 indicates that Verisign Inc. may not have enough cash to cover its short-term liabilities alone.
Overall, based on the declining trends in all three liquidity ratios, Verisign Inc. may be facing challenges in maintaining adequate levels of liquidity to meet its short-term obligations. Investors and stakeholders should closely monitor the company's liquidity position and management's strategies to address any potential liquidity risks.
Additional liquidity measure
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | -21.58 | -16.08 | -12.10 | -12.05 | -16.23 | 89.36 | -13.65 | 81.86 | -15.66 | 98.30 | 87.08 | 72.70 | -23.66 | 70.83 | 66.57 | 59.03 | -27.36 | 80.37 | -12.77 | -10.34 |
Verisign Inc.'s cash conversion cycle fluctuated across the quarters presented. In Q1 2023, the company achieved a cash conversion cycle of 0.00 days, indicating that it was able to convert its investments in inventory and other resources into cash almost instantaneously. This efficiency improved significantly from the previous quarter where the cycle stood at 1.72 days.
However, in Q4 2023, the cash conversion cycle increased to 3.32 days, reflecting a longer period taken to convert investments into cash compared to the previous quarters. This may be a cause for concern as it suggests a potential slowdown in the conversion process.
Overall, Verisign Inc. should continue to monitor and manage its cash conversion cycle effectively to ensure optimal cash flow and operational efficiency. An increasing trend in the cycle duration should prompt the company to investigate potential inefficiencies in inventory management or collection processes.