Today we decided to present you an overview of the quick ratio of CROBEX10 constituents.

The quick ratio is an indicator of a company’s short-term liquidity, and it measures how well a company can meet its short-term obligations with its most liquid assets.  As this indicator shows a company’s ability to instantly use assets that can be quickly converted to cash in order to pay its current liabilities, it’s also called „the acid test ratio“.
The quick ratio is considered more conservative compared to the current ratio, which includes all current assets as coverage for current liabilities. The higher the ratio, the better a company’s liquidity and financial health, the lower the ratio, the more likely the risk that a company will struggle to pay its debts.

To better demonstrate this ratio, we decided to compare constituents of the CROBEX10 index based on it. However, it should be noted that even though this ratio gives an interesting picture of companies, comparison between industries should be taken with a grain of salt.

Out of the CROBEX10 constituents, the companies with the highest quick ratio are Valamar Riviera, HT, and Arena Hospitality with 3.64x, 3.05x, and 2.06x. Out of these 3, 2 could be compared since they operate in the same industry, Valamar Riviera and Arena Hospitality. Here we do see a trend, both of these companies have a high amount of current assets, low inventories, and similar levels of current liabilities. Considering they operate in the tourism industry, this comes as no surprise. Next up we have Ericsson NT and Končar, with 1.9x and 1.7x respectively.

On the flip side, we have AD Plastik, with a quick ratio of 0.69x. The main reason for this relatively low number is the high amount of current liabilities compared to the current assets and inventory of the Company.

Quick Ratio of CROBEX10 Constituents (TTM)