Coventry Health Care, has a Cash Ratio of 0.77. It indicates that there are more current liabilities than Cash, Cash Equivalents, Marketable Securities, and the company does not have sufficient cash on hand to pay off its short-term debt.
The historical rank and industry rank for Coventry Health Care,'s Cash Ratio or its related term are showing as below:
FRA:HCA's Cash Ratio is not ranked *
in the Healthcare Plans industry.
Industry Median: 0.76 * Ranked among companies with meaningful Cash Ratio only.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Competitive Comparison of Coventry Health Care,'s Cash Ratio
For the Healthcare Plans subindustry, Coventry Health Care,'s Cash Ratio, along with its competitors' market caps and Cash Ratio data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Coventry Health Care,'s Cash Ratio Distribution in the Healthcare Plans Industry
For the Healthcare Plans industry and Healthcare sector, Coventry Health Care,'s Cash Ratio distribution charts can be found below:
* The bar in red indicates where Coventry Health Care,'s Cash Ratio falls into.
Coventry Health Care, Cash Ratio Calculation
The Cash Ratio measures a company's ability to meet its short-term obligations with its cash and near-cash resources.
Coventry Health Care,'s Cash Ratio for the fiscal year that ended in Dec. 2012 is calculated as:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Coventry Health Care, (FRA:HCA) Cash Ratio Explanation
The cash ratio is more conservative than other liquidity ratios, such as Quick Ratio and Current Ratio, because it only considers a company's most liquid resources. The numerator of cash ratio only considers Cash, Cash Equivalents and marketable securities. Other current assets, such as accounts receivable and inventories, are not included. The rationale is that these assets may require time to be transformed into cash, and the amount of money received is also uncertain.
The cash ratio shows a company’s ability to pay all current liabilities immediately without selling or liquidating other assets. Generally speaking, a higher cash ratio suggests the company has a stronger ability to cover its short-term debt. However, a high cash ratio could also indicate inefficient management: the company is inefficient in making full utilization of cash to invest protential profitable project. It may also suggest that the company is not confident about future profitability.
In general, the higher the cash ratio, the better the company's liquidity position.
Coventry Health Care, Cash Ratio Related Terms
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Coventry Health Care, (FRA:HCA) Business Description
Coventry Health Care, Inc. was incorporated under the laws of the State of Delaware on December 17, 1997 and is the successor to Coventry Corporation, which was incorporated on November 21, 1986. The Company provides risk and fee-based managed care products and services to a cross section of individuals, employer and government-funded groups, government agencies, and other insurance carriers and administrators. Its operations are segmented into three - Commercial Products, Government Programs and Workers' Compensation. The Commercial Products segment provides health plan commercial risk, commercial management services, Medicare Advantage Coordinated Care Plans, and Medicaid products. Its health plans offer commercial risk products, including health maintenance organization, preferred provider organization, and point of service products to individuals and employer groups. This segment also provides health insurance benefits under the Federal Employees Health Benefits Program; and administrative services only products, such as medical claims administration, pharmacy benefits management, and utilization management and quality assurance programs. In addition, it offers consumer-directed benefit options comprising health reimbursement and savings accounts to commercial customers; provider network rental services through a PPO network to national, regional, and local third-party administrators, as well as insurance carriers; and coordination of mental health and substance abuse treatment services. The Government Programs segment offers Medicare Part D program that provides access to prescription drug coverage for eligible beneficiaries; and comprehensive health benefits on a risk basis to members participating in the Medicare Advantage CCP and Medicaid programs. Its Workers Compensation segment offers fee-based managed care services, such as provider network access, bill review, pharmacy benefit management, durable medical equipment and ancillary services, and care management services to underwriters and administrators of workers compensation insurance. The company serves individuals, employer and government-funded groups, government agencies, and other insurance carriers and administrators through direct sales staff, and independent insurance brokers and agents.
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