2024年6月13日 · Liquidity ratios measure a company's ability to pay debt obligations and its margin of safety through the calculation of metrics including the current ratio, quick...

2025年2月11日 · This ratio helps analysts measure liquidity in "worst-case" scenarios when a company must quickly pay off short-term debt. Related: How to Use Profitability & Margin Ratios. How to Choose the Right Liquidity Ratio. All liquidity ratios use liabilities as a denominator, but the numerator varies in scope—from all current assets to just cash.

A liquidity ratio is used to determine a company’s ability to pay its short-term debt obligations. The three main liquidity ratios are the current ratio, quick ratio, and cash ratio. When analyzing a company, investors and creditors want to see a company with liquidity ratios above 1.0.

2024年9月11日 · A good liquidity ratio is anything greater than 1. It indicates that the company is in good financial health and is less likely to face financial hardships. The higher ratio, the higher is the safety margin that the business possesses to meet its current liabilities.

2023年6月27日 · Liquidity ratios provide an insight into the company's ability to generate cash quickly to cover its short-term debt obligations. They are used to evaluate the effectiveness of a company's working capital management and its overall financial stability.

2023年9月12日 · Liquidity ratios are used to measure the immediate health of a business in terms of how well a company could potentially meet its debt obligations. A company with a liquidity ratio of 1 — but preferably above 1 — is in good standing and able to meet current liabilities.

2024年6月27日 · What is a good liquidity ratio? A good liquidity ratio varies by industry, but generally, a current ratio above 1.5 is considered healthy, indicating that a company can cover its short-term liabilities with its short-term assets.

In short, a “good” liquidity ratio is anything higher than 1. Having said that, a liquidity ratio of 1 is unlikely to prove that your business is worthy of investment. Generally speaking, creditors and investors will look for an accounting liquidity ratio of around 2 or 3.

2023年5月2日 · What is a good current liquidity ratio? The ideal liquidity ratio may vary across industries and depend on the specific circumstances of a company. However, in general, a current liquidity ratio greater than 1 is considered favorable.

2024年9月30日 · How Much Liquidity Ratio Is Good? A good liquidity ratio varies by industry, however, some general rules apply. For the current ratio, a value of 1.5 to 2 is considered good.