Allegro Microsystems Inc (ALGM)

Cash ratio

Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 23, 2022 Sep 23, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021
Cash and cash equivalents US$ in thousands 138,452 188,751 173,136 212,143 214,308 370,013 353,408 351,576 334,306 293,588 286,557 282,383 259,208 248,579 221,934
Short-term investments US$ in thousands — — — — — — — — — — — — — — —
Total current liabilities US$ in thousands 100,912 124,008 105,537 117,908 120,187 134,241 153,545 165,325 137,228 112,754 111,804 104,223 100,841 88,416 119,033
Cash ratio 1.37 1.52 1.64 1.80 1.78 2.76 2.30 2.13 2.44 2.60 2.56 2.71 2.57 2.81 1.86

December 31, 2024 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($138,452K + $—K) ÷ $100,912K
= 1.37

The cash ratio of Allegro Microsystems Inc has shown fluctuations over the analyzed period. The cash ratio measures a company's ability to cover its current liabilities with its cash and cash equivalents.

In June 2023, the cash ratio was 2.34, indicating that the company had $2.34 in cash and cash equivalents for every dollar of current liabilities. This ratio decreased to 1.78 by December 2023, suggesting a potential decrease in the company's liquidity position.

However, the cash ratio improved to 2.13 in March 2024, showing a slight recovery in the company's ability to cover its obligations with cash. Subsequently, the ratio decreased to 1.37 by December 2024, indicating a potential liquidity challenge as the ratio fell below 1, which may suggest the company has insufficient cash to cover its short-term liabilities.

It is important for Allegro Microsystems Inc to monitor its cash ratio closely to ensure it maintains adequate liquidity to meet its short-term obligations and mitigate financial risks. A declining trend in the cash ratio may signal potential challenges in managing cash flow and liquidity.