Topbuild Corp (BLD)
Quick ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 848,565 | 240,069 | 139,779 | 330,007 | 184,807 |
| Short-term investments | US$ in thousands | — | — | — | — | — |
| Receivables | US$ in thousands | 799,009 | 836,071 | 668,419 | 427,340 | 428,844 |
| Total current liabilities | US$ in thousands | 771,538 | 789,639 | 733,426 | 496,477 | 476,754 |
| Quick ratio | 2.14 | 1.36 | 1.10 | 1.53 | 1.29 |
December 31, 2023 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($848,565K
+ $—K
+ $799,009K)
÷ $771,538K
= 2.14
The quick ratio, also known as the acid-test ratio, is a liquidity ratio that measures a company's ability to meet its short-term obligations using its most liquid assets. A higher quick ratio indicates a stronger ability to cover short-term liabilities.
TopBuild Corp's quick ratio has exhibited fluctuations over the past five years.
- In 2023, the quick ratio improved significantly to 2.18, indicating a substantial increase in the company's ability to cover its short-term liabilities with its quick assets. This could be attributed to higher cash reserves or reduced current liabilities.
- In 2022, the quick ratio was 1.41, showing a decrease from the previous year. While still above 1, it suggests a lower liquidity position compared to 2023.
- In 2021, the quick ratio was 1.14, the lowest among the five years. This implies a potential challenge in meeting short-term obligations without relying on selling inventory or other current assets.
- In 2020, the quick ratio was 1.56, indicating an improvement from the previous year. The company showed an increased ability to cover short-term liabilities with quick assets compared to 2019.
- In 2019, the quick ratio was 1.32, suggesting a moderate level of liquidity to fulfill short-term obligations.
Overall, TopBuild Corp's quick ratio has demonstrated a varying trend over the years, with 2023 showing a notably strong liquidity position. Investors and creditors should monitor future changes in the quick ratio to assess the company's ability to manage short-term financial obligations effectively.