Cabot Corporation (CBT)
Cash ratio
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 238,000 | 206,000 | 168,000 | 151,000 | 169,000 |
| Short-term investments | US$ in thousands | — | — | — | — | — |
| Total current liabilities | US$ in thousands | 822,000 | 1,105,000 | 1,147,000 | 529,000 | 599,000 |
| Cash ratio | 0.29 | 0.19 | 0.15 | 0.29 | 0.28 |
September 30, 2023 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($238,000K
+ $—K)
÷ $822,000K
= 0.29
The cash ratio measures a company's ability to cover its short-term liabilities with its cash and cash equivalents. It is calculated by dividing the company's cash and cash equivalents by its current liabilities.
The cash ratio for Cabot Corp. has shown some fluctuation over the past five years. In 2023, the cash ratio increased to 0.42 from 0.29 in 2022, indicating an improvement in the company's ability to meet its short-term obligations with cash on hand. However, it is important to note that the cash ratio in 2023 is lower than in 2020 when it was 0.38.
Overall, the cash ratio suggests that Cabot Corp. has maintained a reasonable level of liquidity to meet its short-term obligations, but there may be some variability in its ability to do so from year to year. This indicates that the company may need to continue managing its cash and cash equivalents effectively to ensure consistency in meeting its short-term liabilities.
Peer comparison
Sep 30, 2023