ZoomInfo Technologies Inc (ZI)

ZoomInfo Technologies Inc.'s liquidity ratios provide insights into its ability to meet short-term financial obligations.

1. Current Ratio:
The current ratio indicates the company's ability to cover short-term liabilities with its current assets. ZoomInfo's current ratio has fluctuated over the years, ranging from 0.61 in 2019 to 1.45 in 2022. The current ratio was 1.35 in 2023, indicating that ZoomInfo may have slightly lower short-term liquidity compared to the previous year.

2. Quick Ratio:
The quick ratio, also known as the acid-test ratio, measures the company's ability to meet short-term obligations with its most liquid assets (excluding inventory). ZoomInfo's quick ratio has followed a similar trend to its current ratio, reflecting a slightly lower figure of 1.35 in 2023 compared to 1.45 in 2022.

3. Cash Ratio:
The cash ratio provides insight into the proportion of immediate obligations that can be covered by cash and cash equivalents. ZoomInfo's cash ratio has varied significantly over the years, from 0.23 in 2019 to 1.05 in 2022. In 2023, the cash ratio decreased to 0.92, indicating a decline in the company's ability to cover short-term obligations solely with cash.

Overall, while ZoomInfo Technologies Inc. maintains a reasonable level of liquidity as indicated by its current, quick, and cash ratios, there has been some volatility in these ratios over the years. It is important for investors and stakeholders to monitor these liquidity metrics to assess the company's short-term financial health.

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Additional liquidity measure

The cash conversion cycle of ZoomInfo Technologies Inc. decreased significantly from -16.72 days in 2022 to -9.29 days in 2023, indicating efficient management of working capital. The negative values suggest that the company is able to convert its inventory into cash and collect receivables faster than paying its payables.

In 2021, the cash conversion cycle was 36.51 days, which was an improvement from the previous year, but still longer compared to the more recent years. The company managed to reduce its cycle significantly in 2022 and 2023.

In 2020, ZoomInfo had a cash conversion cycle of 57.46 days, indicating a longer period required to convert its investments in inventory and receivables into cash. However, in the following years, the company improved its management of working capital.

Overall, ZoomInfo Technologies Inc. has shown a positive trend in its cash conversion cycle, indicating effective management of its operating cycle and working capital, resulting in a shorter period to convert investments into cash.