Workday Inc (WDAY)
Liquidity ratios
| Jan 31, 2025 | Oct 31, 2024 | Jul 31, 2024 | Apr 30, 2024 | Jan 31, 2024 | Oct 31, 2023 | Jul 31, 2023 | Apr 30, 2023 | Jan 31, 2023 | Oct 31, 2022 | Jul 31, 2022 | Apr 30, 2022 | Jan 31, 2022 | Oct 31, 2021 | Jul 31, 2021 | Apr 30, 2021 | Jan 31, 2021 | Oct 31, 2020 | Jul 31, 2020 | Apr 30, 2020 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 1.90 | 2.05 | 2.04 | 2.00 | 1.97 | 2.13 | 2.00 | 1.95 | 1.75 | 1.87 | 1.61 | 1.56 | 1.03 | 1.10 | 1.04 | 0.93 | 1.12 | 1.09 | 1.45 | 1.25 |
| Quick ratio | 1.80 | 2.14 | 2.10 | 1.88 | 1.87 | 2.01 | 1.90 | 1.83 | 1.66 | 1.75 | 1.52 | 1.47 | 0.96 | 1.03 | 0.98 | 0.86 | 1.07 | 1.02 | 1.35 | 1.15 |
| Cash ratio | 1.45 | 1.81 | 1.80 | 1.62 | 1.55 | 1.71 | 1.59 | 1.57 | 1.32 | 1.48 | 1.30 | 1.31 | 0.72 | 0.83 | 0.77 | 0.71 | 0.83 | 0.81 | 1.08 | 0.94 |
Workday Inc's liquidity ratios indicate its ability to meet short-term obligations efficiently. The current ratio, which measures the company's ability to cover its current liabilities with current assets, has shown fluctuations over time. It was below 1 in April 30, 2021, indicating potential liquidity concerns, but improved steadily thereafter, reaching a high of 2.05 on October 31, 2024. This trend suggests an enhancement in Workday's short-term liquidity position.
The quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, followed a similar pattern. It was below 1 in April 30, 2021, reflecting a potential strain on immediate liquidity. However, it improved consistently over subsequent periods, peaking at 2.14 on October 31, 2024. This indicates that Workday has a satisfactory level of liquid assets to cover its short-term liabilities.
In terms of the cash ratio, which provides the most conservative measure of liquidity by considering only cash and cash equivalents, Workday showed a similar improvement in liquidity over time. Although it was below 1 in April 30, 2021, indicating a potential shortfall in cash to cover immediate obligations, it increased steadily to 1.81 on October 31, 2024. This signifies that Workday's ability to meet short-term obligations with cash on hand has strengthened over the years.
Overall, Workday Inc's liquidity ratios have shown a positive trend, reflecting an improved ability to meet its short-term financial obligations and suggesting a healthy liquidity position for the company.
See also:
Additional liquidity measure
| Jan 31, 2025 | Oct 31, 2024 | Jul 31, 2024 | Apr 30, 2024 | Jan 31, 2024 | Oct 31, 2023 | Jul 31, 2023 | Apr 30, 2023 | Jan 31, 2023 | Oct 31, 2022 | Jul 31, 2022 | Apr 30, 2022 | Jan 31, 2022 | Oct 31, 2021 | Jul 31, 2021 | Apr 30, 2021 | Jan 31, 2021 | Oct 31, 2020 | Jul 31, 2020 | Apr 30, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 73.74 | 57.68 | 53.23 | 46.86 | 74.55 | 80.37 | 83.60 | 72.42 | 98.46 | 54.21 | 86.26 | 33.96 | 79.17 | 56.49 | 59.22 | 44.40 | 74.12 | 55.41 | 53.00 | 49.54 |
The cash conversion cycle (CCC) of Workday Inc has shown fluctuations over the period from April 30, 2020, to January 31, 2025. The CCC represents the number of days it takes for a company to convert its investments in inventory and other resources into cash inflows from sales.
Based on the data provided, Workday Inc's CCC ranged from a low of 33.96 days on April 30, 2022, to a high of 98.46 days on January 31, 2023. A lower CCC indicates that the company is able to efficiently manage its working capital and convert its resources into cash more quickly, which can be seen in the lower days such as on April 30, 2022.
However, there were instances where the CCC increased significantly, like on January 31, 2023, indicating potential challenges in managing working capital effectively during that period. It's important for companies to closely monitor their CCC to ensure optimal cash flow management and operational efficiency.
Overall, the fluctuating trend in Workday Inc's CCC suggests varying levels of efficiency in managing inventory, receivables, and payables throughout the reported periods. It would be advisable for the company to analyze the underlying factors contributing to these fluctuations and strategize ways to improve its cash conversion cycle for enhanced financial performance.