CDW Corp (CDW)
Cash ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 503,500 | 588,700 | 315,200 | 258,100 | 1,410,200 |
| Short-term investments | US$ in thousands | 214,200 | 0 | — | — | — |
| Total current liabilities | US$ in thousands | 5,474,400 | 5,442,000 | 4,947,100 | 5,096,000 | 3,898,300 |
| Cash ratio | 0.13 | 0.11 | 0.06 | 0.05 | 0.36 |
December 31, 2024 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($503,500K
+ $214,200K)
÷ $5,474,400K
= 0.13
The cash ratio of CDW Corp has shown a declining trend over the past five years. As of December 31, 2020, the company had a cash ratio of 0.36, indicating that it had $0.36 of cash and cash equivalents for each dollar of current liabilities. However, by December 31, 2021, the cash ratio decreased significantly to 0.05, suggesting a lower level of liquidity and potential difficulty in meeting short-term obligations with available cash.
The trend improved slightly in the following years, with the cash ratio increasing to 0.06 by December 31, 2022, 0.11 by December 31, 2023, and further to 0.13 by December 31, 2024. While the ratios in 2022 to 2024 indicate a modest improvement in liquidity compared to 2021, CDW Corp may still have limited cash reserves relative to its current liabilities.
The declining trend in the cash ratio raises potential concerns about the company's ability to cover its short-term obligations solely with cash on hand. It may be important for CDW Corp to closely monitor and manage its liquidity position to ensure it can meet its upcoming financial commitments.
Peer comparison
Dec 31, 2024