Williams-Sonoma Inc (WSM)
Quick ratio
| Jan 28, 2024 | Jan 29, 2023 | Jan 30, 2022 | Jan 31, 2021 | Feb 2, 2020 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 1,262,010 | 367,344 | 850,338 | 1,200,340 | 432,162 |
| Short-term investments | US$ in thousands | — | — | — | — | — |
| Receivables | US$ in thousands | 122,914 | 115,685 | 131,683 | 143,728 | 111,737 |
| Total current liabilities | US$ in thousands | 1,880,320 | 1,636,450 | 1,771,690 | 1,848,000 | 1,609,560 |
| Quick ratio | 0.74 | 0.30 | 0.55 | 0.73 | 0.34 |
January 28, 2024 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($1,262,010K
+ $—K
+ $122,914K)
÷ $1,880,320K
= 0.74
The quick ratio of Williams-Sonoma Inc has fluctuated over the past five years, indicating varying levels of liquidity. As of Jan 28, 2024, the quick ratio stands at 0.74, suggesting that the company has improved its ability to meet its short-term obligations using its most liquid assets. This marks a significant increase from the quick ratio of 0.30 in Jan 29, 2023, reflecting a notable enhancement in the company's liquidity position within a year.
Comparing the current ratio to previous years, we observe a substantial improvement from 0.34 on Feb 2, 2020, to the current ratio of 0.74, indicating a more favorable liquidity position and increased financial stability. However, it is important to note that the quick ratio was higher in previous years such as Jan 31, 2021, and Jan 30, 2022, at 0.73 and 0.55, respectively.
Overall, the recent increase in the quick ratio indicates that Williams-Sonoma Inc has strengthened its ability to cover its short-term liabilities with its quick assets, signaling improved financial health and liquidity management. Investors and stakeholders may view this positively as it suggests a decreased risk of default and enhanced capacity to meet immediate financial obligations.