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Shopify (Shopify) Cash Ratio : 5.74 (As of Mar. 2024)


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What is Shopify Cash Ratio?

The Cash Ratio measures a company’s ability to meet its short-term obligations with cash and near-cash resources. It is calculated as a company's Cash, Cash Equivalents, Marketable Securities divides by its Total Current Liabilities. Shopify's Cash Ratio for the quarter that ended in Mar. 2024 was 5.74.

Shopify has a Cash Ratio of 5.74. It generally indicates that the company is able to cover all short-term debt and still have cash remaining.

The historical rank and industry rank for Shopify's Cash Ratio or its related term are showing as below:

SHOP' s Cash Ratio Range Over the Past 10 Years
Min: 2.42   Med: 8.95   Max: 16.54
Current: 5.74

During the past 12 years, Shopify's highest Cash Ratio was 16.54. The lowest was 2.42. And the median was 8.95.

SHOP's Cash Ratio is ranked better than
93.87% of 2774 companies
in the Software industry
Industry Median: 0.76 vs SHOP: 5.74

Shopify Cash Ratio Historical Data

The historical data trend for Shopify's Cash 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.

* Premium members only.

Shopify Cash Ratio Chart

Shopify Annual Data
Trend Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22 Dec23
Cash Ratio
Get a 7-Day Free Trial Premium Member Only Premium Member Only 7.76 14.57 11.05 5.90 5.58

Shopify Quarterly Data
Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23 Mar24
Cash Ratio Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 5.51 5.43 5.77 5.58 5.74

Competitive Comparison of Shopify's Cash Ratio

For the Software - Application subindustry, Shopify's Cash Ratio, along with its competitors' market caps and Cash 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.


Shopify's Cash Ratio Distribution in the Software Industry

For the Software industry and Technology sector, Shopify's Cash Ratio distribution charts can be found below:

* The bar in red indicates where Shopify's Cash Ratio falls into.



Shopify Cash Ratio Calculation

The Cash Ratio measures a company's ability to meet its short-term obligations with its cash and near-cash resources.

Shopify's Cash Ratio for the fiscal year that ended in Dec. 2023 is calculated as:

Shopify's Cash Ratio for the quarter that ended in Mar. 2024 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.


Shopify  (NYSE:SHOP) Cash Ratio Explanation

The cash ratio is more conservative than other liquidity ratios, such as Quick Ratio and Current Ratio, because it only considers a company's most liquid resources. The numerator of cash ratio only considers Cash, Cash Equivalents and marketable securities. Other current assets, such as accounts receivable and inventories, are not included. The rationale is that these assets may require time to be transformed into cash, and the amount of money received is also uncertain.

The cash ratio shows a company’s ability to pay all current liabilities immediately without selling or liquidating other assets. Generally speaking, a higher cash ratio suggests the company has a stronger ability to cover its short-term debt. However, a high cash ratio could also indicate inefficient management: the company is inefficient in making full utilization of cash to invest protential profitable project. It may also suggest that the company is not confident about future profitability.

In general, the higher the cash ratio, the better the company's liquidity position.


Shopify Cash Ratio Related Terms

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Shopify (Shopify) Business Description

Address
151 O'Connor Street, Ground Floor, Ottawa, ON, CAN, K2P2L8
Shopify offers an e-commerce platform primarily to small and medium-size businesses. The firm has two segments. The subscription solutions segment allows Shopify merchants to conduct e-commerce on a variety of platforms, including the company's website, physical stores, pop-up stores, kiosks, social networks (Facebook), and Amazon. The merchant solutions segment offers add-on products for the platform that facilitate e-commerce and include Shopify Payments, Shopify Shipping, and Shopify Capital.

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