CVS Quick Ratio Analysis

The quick ratio measures a company’s ability to pay short-term obligations with its most liquid assets, such as cash and receivables, excluding inventory.

At 0.34x, CVS has less than 34 cents in liquid assets for every dollar of current liabilities, indicating a thin liquidity buffer. This is well below the sector median of 0.72x, placing CVS in the 19th percentile among its peers. The metric has been decreasing over the last eight quarters, though a year-over-year change is not available; the quarter-over-quarter decline of -44.3% (from 0.61x to 0.34x) shows a sharp recent deterioration. The combination of a very low level and a declining trend elevates liquidity risk, as the company may face difficulty meeting near-term obligations without selling inventory or raising capital. This directly supports the overall CAUTIOUS verdict, since worsening liquidity adds to the stock’s risk profile.

Frequently Asked Questions

Closest Sector Peers