Amedisys Inc (AMED)

Cash ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cash and cash equivalents	US$ in thousands	126,500	40,500	42,694	81,808	30,294
Short-term investments	US$ in thousands	—	40	—	—	—
Total current liabilities	US$ in thousands	473,721	355,529	374,282	456,337	326,943
Cash ratio		0.27	0.11	0.11	0.18	0.09

December 31, 2023 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($126,500K + $—K) ÷ $473,721K
= 0.27

Amedisys Inc.'s cash ratio has shown a generally increasing trend over the past five years, indicating an improved ability to cover its short-term liabilities with cash and cash equivalents. The cash ratio stood at 0.36 as of Dec 31, 2023, up from 0.22 in the previous year and significantly higher compared to 0.14 in Dec 31, 2019. This suggests that the company has become more liquid and better positioned to meet its immediate financial obligations.

A cash ratio of 0.36 means that for every dollar of current liabilities, Amedisys Inc. holds $0.36 in cash and cash equivalents. This indicates a healthy liquidity position, providing a cushion against potential short-term financial risks. It also implies that the company has sufficient liquid assets to cover its short-term obligations without relying heavily on other sources of funding.

The upward trend in the cash ratio over the years reflects well-managed cash flows and effective cash management practices within Amedisys Inc. This trend may indicate prudent financial decision-making and a focus on maintaining a strong financial position.

Overall, the consistent improvement in Amedisys Inc.'s cash ratio suggests a positive liquidity position and a reduced risk of financial distress resulting from cash flow shortages in the short term. However, further analysis of other financial ratios and considerations of the company's overall financial health would provide a more comprehensive understanding of its financial performance.