Cadence Design Systems Inc (CDNS)

Cash ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cash and cash equivalents	US$ in thousands	1,008,150	882,325	1,088,940	928,432	705,210
Short-term investments	US$ in thousands	130,359	4,490	5,956	4,452	4,600
Total current liabilities	US$ in thousands	1,590,870	1,347,700	971,225	796,808	672,391
Cash ratio		0.72	0.66	1.13	1.17	1.06

December 31, 2023 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($1,008,150K + $130,359K) ÷ $1,590,870K
= 0.72

The cash ratio of Cadence Design Systems, Inc. has shown some variability over the past five years. The cash ratio measures the company's ability to cover its short-term liabilities with its cash and cash equivalents.

The cash ratio was 0.82 as of December 31, 2023, indicating that for every dollar of current liabilities, the company had $0.82 in cash and cash equivalents available. This suggests that the company may have had a slightly lower liquidity position compared to the previous year.

In comparison, the cash ratio was 0.81 as of December 31, 2022, showing a marginal decrease from the prior year. This decline may signal a slightly tighter liquidity position for the company.

On January 1, 2022, the cash ratio was 1.30, indicating that the company had $1.30 in cash and cash equivalents for every dollar of current liabilities. This suggests a strong liquidity position, with the company being able to cover its short-term obligations more comfortably.

The cash ratio was 1.34 as of January 2, 2021, further improving from the previous year. This indicates that the company had ample cash reserves to meet its short-term debts, reflecting a healthy liquidity position.

In comparison, on December 28, 2019, the cash ratio was 1.20, showing a slightly lower liquidity position compared to the following years. Despite this decrease, the company still had a strong ability to cover its short-term liabilities with cash and cash equivalents.

Overall, while the cash ratio of Cadence Design Systems, Inc. has fluctuated over the past five years, it generally points towards the company having a sound liquidity position, with some variations in different years.