Analog Devices Inc (ADI)

Cash ratio

		Nov 2, 2024	Oct 28, 2023	Oct 29, 2022	Oct 30, 2021	Oct 31, 2020
Cash and cash equivalents	US$ in thousands	1,991,340	958,061	1,470,570	1,977,960	1,055,860
Short-term investments	US$ in thousands	371,822	0	454,545	—	86,729
Total current liabilities	US$ in thousands	2,988,280	3,200,970	2,442,660	2,770,310	1,364,990
Cash ratio		0.79	0.30	0.79	0.71	0.84

November 2, 2024 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($1,991,340K + $371,822K) ÷ $2,988,280K
= 0.79

The cash ratio of Analog Devices Inc has shown fluctuation over the past five years. The ratio was relatively low in October 2023 at 0.30, indicating that the company had only $0.30 of cash and cash equivalents for every dollar of current liabilities. However, it significantly improved in November 2024 to 0.79, suggesting that the company had a healthier liquidity position as it had $0.79 of cash and cash equivalents for every dollar of current liabilities.

Analyzing the trend further, the cash ratio was also relatively high in October 2020 at 0.84, indicating strong liquidity. The ratio dipped slightly in October 2021 to 0.71 before rebounding in October 2022 to 0.79.

Overall, the trend in Analog Devices Inc's cash ratio suggests fluctuations in its liquidity position over the past five years. It is essential for the company to maintain a balance between cash reserves and current liabilities to ensure it can meet its short-term obligations.