Avanos Medical Inc (AVNS)

Quick ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cash	US$ in thousands	87,700	127,700	118,500	111,500	205,300
Short-term investments	US$ in thousands	—	—	—	—	—
Receivables	US$ in thousands	142,800	167,900	131,200	167,900	163,800
Total current liabilities	US$ in thousands	234,600	191,000	139,200	166,300	212,500
Quick ratio		0.98	1.55	1.79	1.68	1.74

December 31, 2023 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($87,700K + $—K + $142,800K) ÷ $234,600K
= 0.98

The quick ratio of Avanos Medical Inc has shown a declining trend over the past five years, dropping from 1.85 in 2019 to 1.11 in 2023. This indicates that the company's ability to meet its short-term obligations with its most liquid assets has weakened over the period. A quick ratio above 1.0 is generally considered healthy as it suggests the company can cover its current liabilities with its quick assets. However, the decreasing quick ratio for Avanos Medical Inc may raise concerns about its liquidity position and ability to meet its short-term financial obligations in a timely manner. Further analysis of the components contributing to the quick ratio, such as cash, marketable securities, and receivables, would provide more insight into Avanos Medical Inc's liquidity management.