ZoomInfo Technologies Inc (ZI)

ZoomInfo Technologies Inc.'s liquidity ratios demonstrate consistent and generally healthy liquidity positions over the quarters analyzed.

The current ratio, which measures the company's ability to cover short-term obligations with its current assets, has remained stable and above 1 over the past eight quarters. While the ratio saw fluctuations, ranging from 1.08 to 1.55, it remained within a reasonable range indicating that the company has enough current assets to meet its short-term liabilities.

Similarly, the quick ratio, also known as the acid-test ratio, maintained consistent levels matching the current ratio figures. This ratio excludes inventory from current assets, providing a more stringent measure of liquidity. ZoomInfo Technologies Inc. consistently maintained a quick ratio of 1.08 to 1.55 over the same period, supporting its ability to cover short-term obligations without relying on inventory.

The cash ratio, reflecting the company's ability to cover its current liabilities with its cash and cash equivalents, demonstrated a slightly lower but still relatively stable trend compared to the current and quick ratios. The cash ratio ranged between 0.77 and 1.20 over the quarters analyzed, indicating that ZoomInfo Technologies Inc. had a moderate to high level of liquid cash on hand to meet short-term obligations.

Overall, based on the liquidity ratios analyzed, ZoomInfo Technologies Inc. appears to have maintained a sound liquidity position, indicating its ability to meet short-term financial commitments efficiently.

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Additional liquidity measure

The cash conversion cycle of ZoomInfo Technologies Inc. has exhibited variability over the past eight quarters. In Q4 2023, the company's cash conversion cycle was negative, implying that ZoomInfo was able to convert its investments in inventory and other resources back into cash at a faster rate than paying off its liabilities. This improved efficiency suggests strong working capital management during the quarter.

Conversely, in Q3 2023, the cash conversion cycle increased to 14.91 days, indicating a temporary slowdown in the company's ability to convert its resources into cash. However, this was followed by a notable improvement in Q2 2023, with a cash conversion cycle of 6.55 days, reflecting enhanced operational efficiency during that period.

Q1 2023 also demonstrated a relatively efficient cash conversion cycle of 4.09 days, while Q4 2022 showed a more substantial negative cycle of -16.72 days, suggesting efficient management of working capital and cash flow during that quarter. Further, in Q3 2022, the company achieved a positive cash conversion cycle of 0.76 days, signaling effective management of cash inflows and outflows during the period.

Interestingly, in Q2 2022, the cash conversion cycle increased to 7.41 days, indicating a temporary delay in converting investments back into cash. This was followed by a significant increase in Q1 2022, where the cycle extended to 18.96 days, suggesting a potential need for improved efficiency in managing working capital and cash flow during that quarter.

In summary, the analysis of ZoomInfo Technologies Inc.'s cash conversion cycle over the past eight quarters indicates fluctuations in efficiency, with some quarters demonstrating strong working capital management and others highlighting periods of slower conversion of resources into cash. Monitoring these trends can provide valuable insights into the company's operational efficiency and financial health.