American States Water Company (AWR)

Cash ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cash and cash equivalents	US$ in thousands	14,073	5,997	4,963	36,737	1,334
Short-term investments	US$ in thousands	—	11,847	4,441	1,224	—
Total current liabilities	US$ in thousands	166,623	396,522	155,574	118,572	115,998
Cash ratio		0.08	0.05	0.06	0.32	0.01

December 31, 2023 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($14,073K + $—K) ÷ $166,623K
= 0.08

The cash ratio of American States Water Co. has shown fluctuating trends over the past five years. As of December 31, 2023, the cash ratio stands at 0.45, indicating that the company has $0.45 in cash and cash equivalents for every $1 of current liabilities. This represents a significant improvement compared to the previous year-end, where the cash ratio was only 0.12.

The sharp increase in the cash ratio from 2022 to 2023 suggests that American States Water Co. has improved its liquidity position by holding a higher proportion of cash relative to its current liabilities. However, it is important to note that the cash ratio is relatively lower compared to the levels seen in 2020 (0.54) and 2019 (0.37).

Overall, while the current cash ratio indicates a stronger liquidity position for American States Water Co. compared to the previous year, further analysis of the company's overall liquidity and cash management strategies is recommended to assess the sustainability of this improvement.