Best Buy Co. Inc (BBY)
Cash ratio
| Feb 3, 2024 | Jan 28, 2023 | Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 1,447,000 | 1,874,000 | 2,936,000 | 5,494,000 | 2,229,000 |
| Short-term investments | US$ in thousands | — | 178,000 | — | 65,000 | 117,000 |
| Total current liabilities | US$ in thousands | 7,909,000 | 8,979,000 | 10,674,000 | 10,521,000 | 8,060,000 |
| Cash ratio | 0.18 | 0.23 | 0.28 | 0.53 | 0.29 |
February 3, 2024 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($1,447,000K
+ $—K)
÷ $7,909,000K
= 0.18
The cash ratio of Best Buy Co. Inc has shown a decreasing trend over the past five years. The ratio has declined from 0.53 in January 2021 to 0.18 in February 2024. This indicates that the company had a lower level of cash and cash equivalents relative to its current liabilities in the most recent period.
A decreasing cash ratio may suggest that Best Buy Co. Inc has been less liquid in recent years and may have less capacity to cover its short-term obligations with its cash reserves alone. This could potentially indicate a need for the company to improve its cash management strategies or enhance its liquidity position. It is important for Best Buy Co. Inc to monitor its cash ratio closely and take proactive steps to ensure it maintains a healthy level of liquidity to meet its financial obligations.