Elevance Health Inc. (NYSE:ELV)

Current Ratio

The current ratio exhibits a general downward trend from 1.53 at the beginning of the period to around the mid-1.4s in later quarters. Initial increases were observed until mid-2020, peaking at 1.64 in June 2020, followed by a fluctuating but gradual decline until early 2022. Subsequently, the ratio stabilized around 1.4 to 1.5 with minor quarterly variations through to March 2025. This suggests a slight reduction in short-term liquidity over the examined period, yet overall the company maintains a current ratio consistently above 1, indicating an ability to meet short-term obligations.

Quick Ratio

The quick ratio followed a pattern similar to the current ratio, starting at 1.37 in March 2020 and rising to a peak of 1.49 in June 2020. Thereafter, it experienced a gradual decline reaching approximately 1.21 by September 2022. From late 2022 onwards, the quick ratio showed moderate recovery, fluctuating between 1.29 and 1.34 with slight dips. By March 2025, it settled at 1.31. The trend reflects some variability in the company’s most liquid assets, with a modest decrease over time followed by signs of stabilization.

Cash Ratio

The cash ratio started at 0.95 and increased to a peak of 1.10 in June 2020, indicating strong cash and cash equivalents relative to current liabilities early in the period. After this peak, the ratio declined gradually and somewhat consistently, reaching the lowest point of 0.79 by March 2025. There were minor rebounds mid-period, but the overall trajectory was downward. This suggests a reduction in the company’s absolute cash liquidity relative to its current liabilities over time, which could indicate changes in cash management policies or working capital structure.

The analysis of the quarterly financial data reveals distinct trends in the company's liquidity position over the observed period. Current assets and current liabilities, the two primary components in assessing short-term financial health, exhibit progressive movements with specific patterns worth noting.

Current Assets

Current assets generally show an upward trend throughout the timeline, beginning at 41,256 million US dollars in March 2020 and rising to 61,121 million US dollars by March 2025. While there are minor fluctuations quarter-to-quarter, the overall trajectory indicates growth in the resources available to cover short-term obligations. Notably, there is a significant increase during the transition from 2020 to 2021, with current assets jumping from approximately 45,751 million to 54,495 million, suggesting an improvement in asset liquidity or asset acquisition strategies. The values stabilize somewhat in subsequent quarters but maintain an elevated level relative to the earlier periods.

Current Liabilities

Current liabilities demonstrate a similar upward movement, increasing from 27,039 million US dollars in March 2020 to 42,698 million US dollars by March 2025. This increment implies a rise in short-term obligations over time. The data reveals consistent growth within this category, with occasional quarters showing slight decreases or stability, possibly reflecting effective liability management or repayment efforts. The highest liability levels tend to align closely with peaks in current assets, maintaining a proportional growth pattern between these two balance sheet components.

Current Ratio

The current ratio, a key indicator of liquidity, exhibits fluctuations within the range of approximately 1.35 to 1.64 across the quarters analyzed. Initially, the ratio peaks around mid-2020 at approximately 1.64, reflecting strong liquidity conditions. Subsequently, it decreases steadily to a low near 1.35 between mid-2021 and late 2022, indicating a phase where liabilities grew relatively faster than current assets, slightly compressing liquidity buffers. Post-2022, the ratio recovers moderately to roughly 1.45 by early 2025, signaling an improvement in short-term financial stability. Nonetheless, the current ratio consistently remains above 1.3, suggesting that current assets continuously exceed current liabilities by a comfortable margin throughout the period.

In summary, the data indicates that the company has been expanding both its current assets and liabilities over time, reflecting growth and possibly increased operational scale. The current ratio's fluctuation points to varying liquidity dynamics, but consistently favorable short-term solvency is maintained. The slight downward trend in the ratio during 2021-2022 warrants attention to potential pressures on liquidity despite the growing asset base. Overall, the company's ability to meet its short-term obligations appears stable and well-managed across the quarters analyzed.

Total Quick Assets

The total quick assets show an overall increasing trend from March 31, 2020, through March 31, 2025. Beginning at 37,121 million USD in the first quarter of 2020, they rise to 55,833 million USD by March 31, 2025. Despite fluctuations across quarters, including slight dips observed in mid-2021 and late 2023 through early 2024, the general direction for quick assets is upward. Peaks are noted around March 2023 and September 2024, reflecting stronger liquidity positions during these periods.

Current Liabilities

Current liabilities have increased significantly from 27,039 million USD in March 2020 to 42,698 million USD by March 2025. Notably, there is a pronounced rise in liabilities from early 2021 through 2023, peaking around March 2022 and December 2023. Although some quarters present reductions, such as mid-2024, the overall level of current liabilities remains substantially above the 2020 baseline, indicating greater short-term obligations over time.

Quick Ratio

The quick ratio exhibits a declining trend in the initial years, moving from 1.37 in March 2020 down to lows near 1.21 by late 2022, signaling a gradual decrease in immediate liquidity relative to current liabilities. However, from late 2022 onwards, the quick ratio stabilizes and slightly improves, fluctuating between 1.29 and 1.34. Despite the improvement, the recent quick ratio levels remain modestly below the early 2020 values, suggesting that while liquidity coverage has strengthened somewhat, it is still less robust than in the pre-2021 period.

Overall Liquidity Analysis

The increase in total quick assets is tempered by a more pronounced rise in current liabilities, which has exerted pressure on the quick ratio. While liquidity coverage decreased noticeably through 2022, the subsequent recovery in the quick ratio suggests proactive management of liquid resources or control over liabilities. The data imply a cautious approach toward balancing asset growth with liability management, maintaining adequate short-term liquidity but at marginally lower coverage ratios compared to earlier periods.

The data reveals several noteworthy trends concerning liquidity and short-term financial position over the examined quarters.

Total Cash Assets

The total cash assets display a fluctuating pattern between March 2020 and March 2025. Beginning at approximately $25,796 million in March 2020, cash assets increased sharply to a peak around $37,511 million by March 2021. Subsequently, there was a gradual decline and oscillation around the $34,000 to $38,000 million range through 2023. In the latest periods, a moderate decrease is noted, ending at approximately $33,652 million in March 2025. This indicates some volatility but an overall higher level of cash assets compared to the starting period.

Current Liabilities

Current liabilities have shown a general upward trend over the same timeframe. From roughly $27,039 million in March 2020, current liabilities rose steadily, peaking around $44,334 million in June 2024. There are some fluctuations but the trend remains predominantly increasing. This suggests growing short-term obligations, which may impact liquidity management and financial flexibility.

Cash Ratio

The cash ratio demonstrates a declining trend, reflecting changes in liquidity relative to current liabilities. Starting slightly below parity at 0.95 in March 2020, it peaked over 1.0 in mid to late 2020 and early 2021, indicating ample cash coverage of current liabilities. From mid-2021 onward, the ratio steadily decreased, falling below 0.9 in most subsequent quarters, with a low of 0.79 in March 2025. This decline implies a weakening in the capacity to cover short-term liabilities with cash alone, potentially signaling tighter liquidity conditions.

Overall, the data indicates that while cash reserves increased significantly during 2020 and early 2021, this was accompanied by an even more pronounced rise in current liabilities over the longer term. The resulting decline in the cash ratio highlights a reduction in liquidity strength, warranting attention to working capital strategies and the management of short-term obligations.