Builders FirstSource Inc (BLDR)

Cash ratio

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Cash and cash equivalents	US$ in thousands	153,624	66,156	80,445	42,603	423,806
Short-term investments	US$ in thousands	—	—	—	—	—
Total current liabilities	US$ in thousands	1,777,280	1,863,440	1,842,780	2,128,710	1,074,850
Cash ratio		0.09	0.04	0.04	0.02	0.39

December 31, 2024 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($153,624K + $—K) ÷ $1,777,280K
= 0.09

The cash ratio of Builders FirstSource Inc has shown fluctuation over the years according to the provided data. As of December 31, 2020, the company's cash ratio stood at 0.39, indicating that it had $0.39 in cash and cash equivalents for every $1 of current liabilities.

However, there was a significant decline in the cash ratio by the end of 2021, dropping to 0.02. This sharp decrease suggests that the company had a much lower level of liquid assets available to cover its short-term obligations, which could potentially raise liquidity concerns.

In the following years, the cash ratio improved slightly, reaching 0.04 by the end of both 2022 and 2023. This slight increase indicates a better but still relatively low liquidity position compared to previous years.

By the end of 2024, the cash ratio further increased to 0.09, showing a notable improvement in the company's ability to meet its short-term liabilities with its cash resources. However, despite the improvement, the cash ratio remained at a level that may still warrant attention to ensure adequate liquidity management.

Overall, the fluctuating trend of the cash ratio for Builders FirstSource Inc suggests that the company has experienced varying levels of liquidity over the years, necessitating ongoing monitoring and management of its cash position to ensure sustainable financial health and meet its obligations effectively.