AutoZone Inc (AZO)

Cash ratio

		Aug 26, 2023	Aug 27, 2022	Aug 28, 2021	Aug 29, 2020	Aug 31, 2019
Cash and cash equivalents	US$ in thousands	277,054	264,380	1,171,340	1,750,820	176,300
Short-term investments	US$ in thousands	39,639	49,768	46,007	76,118	67,958
Total current liabilities	US$ in thousands	8,511,860	8,588,390	7,369,750	6,283,090	5,512,140
Cash ratio		0.04	0.04	0.17	0.29	0.04

August 26, 2023 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($277,054K + $39,639K) ÷ $8,511,860K
= 0.04

The cash ratio of Autozone Inc. has shown fluctuations over the past five years. In 2023 and 2022, the cash ratio remained consistent at 0.06, indicating the company had $0.06 in cash and cash equivalents for every $1 of current liabilities. This could suggest a potential liquidity concern.

However, in 2021, the cash ratio increased to 0.19, reflecting an improvement in the company's ability to cover its short-term liabilities with cash and cash equivalents. This may indicate a stronger liquidity position.

In 2020, the cash ratio further improved to 0.31, indicating a significant increase in the company's ability to meet its short-term obligations with its available cash. This could be a positive sign of improved liquidity management or increased cash reserves.

In contrast, the cash ratio dipped to 0.07 in 2019, signaling a decrease in the company's ability to cover its short-term liabilities with its available cash and cash equivalents.

In summary, the cash ratio of Autozone Inc. has exhibited varying levels of liquidity over the past five years, with fluctuations that may warrant further investigation into the company's cash management and liquidity position.