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Arno Therapeutics (OTCPK:ARNI) Quick Ratio Explanation
The quick ratio is more conservative than the Current Ratio because it excludes inventories from current assets. The ratio derives its name presumably from the fact that assets such as cash and marketable securities are quick sources of cash. Inventories generally take time to be converted into cash, and if they have to be sold quickly, the company may have to accept a lower price than book value of these inventories. As a result, they are justifiably excluded from assets that are ready sources of immediate cash.
In general, low or decreasing quick ratios generally suggest that a company is over-leveraged, struggling to maintain or grow sales, paying bills too quickly or collecting receivables too slowly. On the other hand, a high or increasing quick ratio generally indicates that a company is experiencing solid top-line growth, quickly converting receivables into cash, and easily able to cover its financial obligations. Such companies often have faster inventory turnover and cash conversion cycles.
The higher the quick ratio, the better the company's liquidity position.
Arno Therapeutics Quick Ratio Related Terms
Arno Therapeutics Quick Ratio Historical Data
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The historical data trend for Arno Therapeutics's Quick 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.
For the Biotechnology subindustry, Arno Therapeutics's Quick Ratio, along with its competitors' market caps and Quick 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.
Arno Therapeutics Quick Ratio vs Biotechnology Industry
For the Biotechnology industry and Healthcare sector, Arno Therapeutics's Quick Ratio distribution charts can be found below:
* The bar in red indicates where Arno Therapeutics's Quick Ratio falls into.
The quick ratio measures a company's ability to meet its short-term obligations with its most liquid assets. For this reason, the ratio excludes inventories from current assets.
Arno Therapeutics's Quick 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.
Arno Therapeutics (ARNI) has a Quick Ratio of 1.52 as of Sep. 2016. Quick ratio is the ratio of current assets less inventory to current liabilities. View historical data on Arno Therapeutics and its competitors.
Is Arno Therapeutics' Quick Ratio too high?
Arno Therapeutics' current Quick Ratio is 1.52. The Biotechnology industry median Quick Ratio is 3.57. Arno Therapeutics' value of 1.52 is 57.4% below this industry median.
How does Arno Therapeutics' Quick Ratio compare to PLPL and BTHE?
Arno Therapeutics' Quick Ratio of 1.52 can be compared against companies in the Biotechnology industry. The industry median Quick Ratio is 3.57. Arno Therapeutics' value of 1.52 is 57.4% below this benchmark. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Quick Ratio for a Biotechnology company?
The median Quick Ratio among Biotechnology companies is 3.57, based on 1,411 companies in the industry. Companies in the top quartile (top 25%) have a Quick Ratio significantly above this median, while those in the bottom quartile fall well below. However, Quick Ratio should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Arno Therapeutics's current Quick Ratio of 1.52 is 57.4% below the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Quick Ratio mean?
A high Quick Ratio can signal that a stock is expensive relative to its fundamentals. Quick ratio is the ratio of current assets less inventory to current liabilities. View historical data on Arno Therapeutics and its competitors. For the Biotechnology industry, the median Quick Ratio is 3.57 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Arno Therapeutics's current Quick Ratio is 1.52. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Arno Therapeutics stock overvalued right now?
Arno Therapeutics (ARNI) has a current Quick Ratio of 1.52. The current Quick Ratio is 1.52 and 57.4% below the Biotechnology industry median of 3.57. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Quick Ratio calculated?
Quick Ratio is calculated from a company's financial statements. For Arno Therapeutics (ARNI), the current Quick Ratio is 1.52 as of Sep. 2016. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Arno Therapeutics Inc operates as a biopharmaceutical company. It develops drug candidates to treat patients with cancer and other life-threatening diseases. It develops pre-clinical and clinical-stage product under the following name: Onapristone, AR-42, and AR-12. Onapristone is indicated for endometrial, prostate and breast cancer indications, AR-42 is provided for hematological malignancies and solid tumors indications and AR-12 is offered for solid tumors and hematological malignancies, and various anti-microbial targets.
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