The current ratio is a liquidity ratio that measures a company's ability to pay short-term obligations. It is calculated as a company's Total Current Assets divides by its Total Current Liabilities. Demandware's current ratio for the quarter that ended in Mar. 2016 was 4.03.
Demandware has a current ratio of 4.03. It indicates the company may not be efficiently using its current assets or its short-term financing facilities. This may also indicate problems in working capital management.
The historical rank and industry rank for Demandware's Current Ratio or its related term are showing as below:
DWRE's Current Ratio is not ranked *
in the Software industry.
Industry Median: 1.79 * Ranked among companies with meaningful Current Ratio only.
Demandware Current Ratio Historical Data
The historical data trend for Demandware's Current 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.
Competitive Comparison of Demandware's Current Ratio
For the Software - Application subindustry, Demandware's Current Ratio, along with its competitors' market caps and Current 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.
Demandware's Current Ratio Distribution in the Software Industry
For the Software industry and Technology sector, Demandware's Current Ratio distribution charts can be found below:
* The bar in red indicates where Demandware's Current Ratio falls into.
Demandware Current Ratio Calculation
The current ratio is mainly used to give an idea of the company's ability to pay back its short-term liabilities with its short-term assets.
Demandware's Current Ratio for the fiscal year that ended in Dec. 2015 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.
Demandware (NYSE:DWRE) Current Ratio Explanation
The current ratio can give a sense of the efficiency of a company's operating cycle or its ability to turn its product into cash. Companies that have trouble getting paid on their receivables or have long inventory turnover can run into liquidity problems because they are unable to alleviate their obligations. Because business operations differ in each industry, it is always more useful to compare companies within the same industry.
Acceptable current ratios vary from industry to industry and are generally between 1 and 3 for healthy businesses.
The higher the current ratio, the more capable the company is of paying its obligations. A ratio under 1 suggests that the company would be unable to pay off its obligations if they came due at that point. While this shows the company is not in good financial health, it does not necessarily mean that it will go bankrupt - as there are many ways to access financing - but it is definitely not a good sign.
If all other things were equal, a creditor, who is expecting to be paid in the next 12 months, would consider a high current ratio to be better than a low current ratio, because a high current ratio means that the company is more likely to meet its liabilities which fall due in the next 12 months.
Demandware Current Ratio Related Terms
Thank you for viewing the detailed overview of Demandware's Current Ratio provided by GuruFocus.com. Please click on the following links to see related term pages.
Demandware Inc was incorporated in Delaware in February 2004 as SSE Holding, Inc. and changed its name to Demandware, Inc. in August 2004. The Company provides enterprise-class cloud-based digital commerce solutions for retailers and branded manufacturers. Its platform, Demandware Commerce, enables customers to establish and execute complex digital commerce strategies that include expansion, multi-brand rollouts and omni-channel operations. It enable companies to easily design, implement and manage their own customized digital commerce sites, including websites, mobile applications, in-store solutions and other digital storefronts. Through its scalable, secure, and open Demandware Commerce platform, its customers create seamless brand experiences to reach their consumers across all digital touch points globally. The Company's cloud infrastructure increases processing capacity of its customers' digital commerce sites to meet surges in demand, minimize page load times and maximize uptime. Its cloud platform also offers the high reliability and security required by customers to implement their digital commerce strategies, and the Company has achieved 99.99% average platform availability since 2005. The Company has built an ecosystem of trusted partners called Demandware LINK that complements and optimizes Demandware Commerce. Demandware LINK is comprised of technology, solution and end-to end partners. Its geographical areas of operations include, United States, Germany and United Kingdom. The Company's customers include adidas, Barneys New York, Bestseller, Brooks Brothers, Carter's, Deckers, Guthy-Renker, House of Fraser, Jewelry Television, Kate Spade, Lands' End, L'Oreal, mothercare, s.Oliver, and Tory Burch. The Company competes with IBM, Oracle/ATG, eBay/Magento, Digital River, eBay/GSI Commerce, MarketLive and Venda. Its solutions are subject to export controls, including the Commerce Department's Export Administration Regulations and various economic and trade sanctions regulations established by the Treasury Department's Office of Foreign Assets Controls, and exports of its solutions must be made in compliance with these laws.
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