Alkermes Plc (ALKS)

Cash ratio

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Cash and cash equivalents	US$ in thousands	291,146	457,469	292,473	337,544	272,961
Short-term investments	US$ in thousands	460,522	316,022	315,992	198,767	362,066
Total current liabilities	US$ in thousands	465,199	520,220	497,742	471,286	438,258
Cash ratio		1.62	1.49	1.22	1.14	1.45

December 31, 2024 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($291,146K + $460,522K) ÷ $465,199K
= 1.62

The cash ratio of Alkermes Plc has shown some fluctuations over the past five years. In December 31, 2020, the cash ratio was 1.45, indicating that the company had $1.45 in cash and cash equivalents for every $1 of current liabilities. This ratio decreased to 1.14 by December 31, 2021, suggesting a slight decrease in the company's ability to cover its short-term obligations with its available cash.

However, there was a subsequent improvement in the cash ratio in the following years. In December 31, 2022, the cash ratio increased to 1.22, showing a better ability to meet short-term liabilities with cash on hand. The trend continued in December 31, 2023, with the cash ratio further improving to 1.49, indicating a stronger liquidity position.

By December 31, 2024, the cash ratio reached 1.62, demonstrating the highest level of liquidity in the past five years. This suggests that Alkermes Plc has been able to enhance its ability to cover its short-term obligations with available cash and cash equivalents over time. Overall, the trend in the cash ratio reflects a positive liquidity position and the company's ability to meet its short-term financial commitments effectively.