Choice Hotels International Inc (CHH)

Quick ratio

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Cash	US$ in thousands	26,754	36,432	36,167	31,679	41,566	52,541	607,185	527,209	511,605	415,116	307,975	222,961	234,779	191,967	314,139	321,954	33,766	31,569	34,407	31,810
Short-term investments	US$ in thousands	—	-55,081	-44,946	-33,216	—	—	—	—	—	42,961	42,793	—	29,104	26,454	—	—	—	—	—	—
Receivables	US$ in thousands	230,945	282,250	278,150	271,932	273,839	350,517	260,773	234,008	220,111	269,333	272,271	197,831	118,731	205,453	187,885	182,995	141,566	171,802	181,452	153,969
Total current liabilities	US$ in thousands	942,690	418,994	406,686	369,574	435,898	426,383	582,351	563,513	570,295	590,594	315,975	243,800	255,847	252,420	218,737	255,420	325,888	316,304	321,008	303,871
Quick ratio		0.27	0.63	0.66	0.73	0.72	0.95	1.49	1.35	1.28	1.23	1.97	1.73	1.50	1.68	2.30	1.98	0.54	0.64	0.67	0.61

December 31, 2023 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($26,754K + $—K + $230,945K) ÷ $942,690K
= 0.27

The quick ratio of Choice Hotels International Inc has varied over the period under consideration. The quick ratio measures the company's ability to meet its short-term obligations using its most liquid assets. A quick ratio higher than 1 indicates that the company has enough liquid assets to cover its short-term liabilities.

From the data provided, we observe that the quick ratio fluctuated between 0.27 and 2.30 during the period. The quick ratio was lowest at 0.27 on December 31, 2023, which suggests that the company may have had difficulties meeting its short-term obligations with its current liquid assets at that point in time.

On the other hand, the highest quick ratio of 2.30 was recorded on June 30, 2020, indicating that the company had a strong ability to cover its short-term liabilities with its liquid assets at that time.

Overall, the trend in the quick ratio for Choice Hotels International Inc shows some variability, with periods of both lower and higher liquidity levels. It is essential for the company to maintain a healthy balance between its liquid assets and short-term liabilities to ensure financial stability and operational flexibility.