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Porta Communications (LSE:PTCM) 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.
Porta Communications Quick Ratio Related Terms
Porta Communications Quick Ratio Historical Data
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The historical data trend for Porta Communications'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 Advertising Agencies subindustry, Porta Communications'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.
Porta Communications Quick Ratio vs Media - Diversified Industry
For the Media - Diversified industry and Communication Services sector, Porta Communications's Quick Ratio distribution charts can be found below:
* The bar in red indicates where Porta Communications'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.
Porta Communications's Quick Ratio for the fiscal year that ended in Dec. 2018 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.
Porta Communications (LSE:PTCM) has a Quick Ratio of 0.65 as of Dec. 2018. Quick ratio is the ratio of current assets less inventory to current liabilities. View historical data on Porta Communications and its competitors. This is 24% below median its historical median of 0.85. Over the past decade, Porta Communications' Quick Ratio has ranged from 0.44 to 4.15.
Is Porta Communications' Quick Ratio too high?
Porta Communications' current Quick Ratio of 0.65 is 24% below median its 10-year median of 0.85. Over the past 10 years, this metric has ranged from a low of 0.44 to a high of 4.15. The Media - Diversified industry median Quick Ratio is 1.45. Porta Communications' value of 0.65 is 55% below this industry median.
How does Porta Communications' Quick Ratio compare to NWCN and ADMG?
Porta Communications' Quick Ratio of 0.65 can be compared against companies in the Media - Diversified industry. The industry median Quick Ratio is 1.45. Porta Communications' value of 0.65 is 55% below this benchmark. Historically, Porta Communications' own Quick Ratio has ranged from 0.44 to 4.15 over the past decade. While the company's 10-year median is 0.85 vs. the industry median of 1.45, Porta Communications has consistently been below the industry average. 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 Media - Diversified company?
The median Quick Ratio among Media - Diversified companies is 1.45, based on 1,026 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. Porta Communications's current Quick Ratio of 0.65 is 55% 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 Porta Communications and its competitors. For the Media - Diversified industry, the median Quick Ratio is 1.45 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Porta Communications's current Quick Ratio is 0.65, which is 24% below median its own 10-year median of 0.85. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Porta Communications stock overvalued right now?
Porta Communications (LSE:PTCM) has a current Quick Ratio of 0.65. The current Quick Ratio is 0.65, which is 24% below median its 10-year median of 0.85 and 55% below the Media - Diversified industry median of 1.45. 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 Porta Communications (LSE:PTCM), the current Quick Ratio is 0.65 as of Dec. 2018. 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.
Porta Communications PLC is communications, marketing, design, advertising and analytical service provider. The company engages its business through three segments: Corporate Communications, Marketing and Advertising, and Head Office. Its operating segments include Corporate Communications and Marketing and Advertising through which it offers public relations, public affairs, media buying, advertising, marketing and corporate branding services. Its Head Office segment offers group treasury, and finance and management services. The majority of the company revenues are generated through the Corporate Communications segment mainly from the Europe and Asia-Pacific region.
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