The quick ratio measures a company's ability to meet its short-term obligations with its most liquid assets. It is calculated as a company's Total Current Assets excludes Total Inventories divides by its Total Current Liabilities. CVS Health's quick ratio for the quarter that ended in Dec. 2023 was 0.63.
CVS Health has a quick ratio of 0.63. It indicates that the company cannot currently fully pay back its current liabilities.
The historical rank and industry rank for CVS Health's Quick Ratio or its related term are showing as below:
CVS'
s Quick Ratio Range Over the Past 10 Years
Min: 0.52 Med: 0.63 Max: 0.74
Current: 0.63
During the past 13 years, CVS Health's highest Quick Ratio was 0.74. The lowest was 0.52. And the median was 0.63.
CVS's Quick Ratio is ranked worse than 100% of 17
companies
in the Healthcare Plans industry
Industry Median: 1.24
vs CVS: 0.63
CVS Health Quick Ratio Historical Data
The historical data trend for CVS Health's Quick Ratio can be seen below:
* 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.
* Premium members only.
CVS Health Annual Data
Trend
Dec14
Dec15
Dec16
Dec17
Dec18
Dec19
Dec20
Dec21
Dec22
Dec23
Quick Ratio
0.62
0.61
0.62
0.67
0.63
CVS Health Quarterly Data
Mar19
Jun19
Sep19
Dec19
Mar20
Jun20
Sep20
Dec20
Mar21
Jun21
Sep21
Dec21
Mar22
Jun22
Sep22
Dec22
Mar23
Jun23
Sep23
Dec23
Quick Ratio
0.67
0.67
0.64
0.64
0.63
Competitive Comparison
For the Healthcare Plans subindustry, CVS Health's Quick Ratio, along with its competitors' market caps and Quick 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.
CVS Health Quick Ratio Distribution
For the Healthcare Plans industry and Healthcare sector, CVS Health's Quick Ratio distribution charts can be found below:
* The bar in red indicates where CVS Health's Quick Ratio falls into.
CVS Health Quick Ratio Calculation
The quick ratio measures a company's ability to meet its short-term obligations with its most liquid assets. For this reason, the ratio excludes inventories from current assets.
CVS Health's Quick Ratio for the fiscal year that ended in Dec. 2023 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.
CVS Health (NYSE:CVS) Quick Ratio Explanation
The quick ratio is more conservative than the Current Ratio because it excludes inventories from current assets. The ratio derives its name presumably from the fact that assets such as cash and marketable securities are quick sources of cash. Inventories generally take time to be converted into cash, and if they have to be sold quickly, the company may have to accept a lower price than book value of these inventories. As a result, they are justifiably excluded from assets that are ready sources of immediate cash.
In general, low or decreasing quick ratios generally suggest that a company is over-leveraged, struggling to maintain or grow sales, paying bills too quickly or collecting receivables too slowly. On the other hand, a high or increasing quick ratio generally indicates that a company is experiencing solid top-line growth, quickly converting receivables into cash, and easily able to cover its financial obligations. Such companies often have faster inventory turnover and cash conversion cycles.
The higher the quick ratio, the better the company's liquidity position.
CVS Health Quick Ratio Related Terms
Thank you for viewing the detailed overview of CVS Health's Quick Ratio provided by GuruFocus.com. Please click on the following links to see related term pages.
CVS Health offers a diverse set of healthcare services. Its roots are in its retail pharmacy operations, where it operates over 9,000 stores primarily in the U.S. CVS is also the largest pharmacy benefit manager (acquired through Caremark), processing over 2 billion adjusted claims annually. It also operates a top-tier health insurer (acquired through Aetna) where it serves about 26 million medical members. The company's recent acquisition of Oak Street adds primary care services to the mix, which could have significant synergies with all its existing business lines.
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