Alaska Air Group Inc (ALK)
Cash ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 281,000 | 338,000 | 470,000 | 1,370,000 | 221,000 |
| Short-term investments | US$ in thousands | 1,510,000 | 2,079,000 | 2,646,000 | 1,976,000 | 1,300,000 |
| Total current liabilities | US$ in thousands | 4,459,000 | 4,493,000 | 3,991,000 | 4,293,000 | 3,201,000 |
| Cash ratio | 0.40 | 0.54 | 0.78 | 0.78 | 0.48 |
December 31, 2023 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($281,000K
+ $1,510,000K)
÷ $4,459,000K
= 0.40
The cash ratio of Alaska Air Group Inc. has fluctuated over the past five years, indicating varying levels of liquidity. The cash ratio measures the company's ability to cover its short-term liabilities with its cash and cash equivalents.
In 2023, the cash ratio decreased to 0.49 from 0.59 in 2022, suggesting a lower ability to meet short-term obligations with available cash. However, it is important to note that the cash ratio alone does not provide the full picture of the company's liquidity position, as it excludes other current assets that could be quickly converted to cash.
Comparing to prior years, the cash ratio was higher in 2021 at 0.83 and 2020 at 0.81, indicating stronger liquidity positions during those years. The decrease in 2023 might raise concerns about the company's ability to cover short-term liabilities with its current cash holdings.
In 2019, the cash ratio was 0.51, indicating a lower liquidity position compared to recent years. Overall, it is essential for investors and analysts to consider other liquidity ratios and factors in conjunction with the cash ratio to gain a comprehensive understanding of Alaska Air Group Inc.'s liquidity position.
Peer comparison
Dec 31, 2023