Cogent Communications Group Inc (CCOI)
Quick ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 75,092 | 223,783 | 319,609 | 371,301 | 399,422 |
| Short-term investments | US$ in thousands | — | — | — | — | — |
| Receivables | US$ in thousands | 135,475 | 44,123 | 41,938 | 44,185 | 40,484 |
| Total current liabilities | US$ in thousands | 373,324 | 120,284 | 81,010 | 94,443 | 89,694 |
| Quick ratio | 0.56 | 2.23 | 4.46 | 4.40 | 4.90 |
December 31, 2023 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($75,092K
+ $—K
+ $135,475K)
÷ $373,324K
= 0.56
The quick ratio of Cogent Communications Holdings Inc has experienced a downward trend over the past five years. Starting at a healthy level of 5.30 in 2019, the quick ratio has steadily declined to 4.83 in 2020, further dropping to 4.94 in 2021, and significantly decreasing to 2.61 in 2022. The most recent data for 2023 reflects a quick ratio of 1.27.
A quick ratio above 1 indicates that the company's current assets, excluding inventory, are sufficient to cover its current liabilities. While the quick ratio was robust in the earlier years, the declining trend is a cause for concern as it indicates a potential decrease in the company's ability to meet its short-term obligations with liquid assets. This suggests a potential liquidity risk in the company's current financial position. Further analysis of the company's liquidity management and working capital practices may be necessary to address this downward trend in the quick ratio.
Peer comparison
Dec 31, 2023