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Current Ratio Analysis
Current Ratio is calculated by dividing the Current Assets of a company by its Current Liabilities. It measures whether or not a company has enough cash or liquid assets to pay its current liability over the next fiscal year. The ratio is regarded as a test of liquidity for a company.
Typically, short-term creditors will prefer a high current ratio because it reduces their overall risk. However, investors may prefer a lower current ratio since they are more concerned about growing the business using assets of the company. Acceptable current ratios may vary from one sector to another, but generally accepted benchmark is to have current assets at least as twice as current liabilities (i.e. Current Ration of 2 to 1).
In accordance with recently published financial statements CVS Health Corporation has Current Ratio of 2.37 times. This is 18.56% lower than that of the Healthcare sector, and significantly higher than that of Healthcare Services industry, The Current Ratio for all stocks is 28.18% higher than the company.
CVS Health Current Ratio Comparison
CVS Health Comparables
CVS Health is rated below average in current ratio category among related companies.