Builders FirstSource Inc (BLDR)

Current ratio

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Total current assets	US$ in thousands	3,141,240	3,300,730	3,497,650	3,968,270	2,223,680
Total current liabilities	US$ in thousands	1,777,280	1,863,440	1,842,780	2,128,710	1,074,850
Current ratio		1.77	1.77	1.90	1.86	2.07

December 31, 2024 calculation

Current ratio = Total current assets ÷ Total current liabilities
= $3,141,240K ÷ $1,777,280K
= 1.77

Builders FirstSource Inc's current ratio has shown a gradual decline over the past five years, decreasing from 2.07 on December 31, 2020 to 1.77 on both December 31, 2023, and December 31, 2024. This indicates that the company may be facing challenges in maintaining its short-term liquidity position in relation to its current liabilities. However, the current ratio has remained relatively stable around the 1.8 to 1.9 range from 2021 to 2022.

A current ratio above 1 typically suggests that the company is able to cover its short-term obligations with its current assets. While a ratio of 1.77 is still considered acceptable, a declining trend may raise concerns regarding the company's ability to effectively manage its short-term liquidity in the future. It would be important for Builders FirstSource Inc to closely monitor its current ratio and take necessary steps to improve liquidity if needed, such as reducing current liabilities or increasing current assets, to ensure financial stability.