Cohu Inc (COHU)
Current ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total current assets | US$ in thousands | 638,818 | 764,851 | 750,793 | 485,046 | 439,696 |
| Total current liabilities | US$ in thousands | 103,421 | 160,872 | 192,459 | 174,453 | 148,885 |
| Current ratio | 6.18 | 4.75 | 3.90 | 2.78 | 2.95 |
December 31, 2023 calculation
Current ratio = Total current assets ÷ Total current liabilities
= $638,818K ÷ $103,421K
= 6.18
Cohu Inc's current ratio has shown a consistent trend of improvement over the past five years, indicating a strengthening liquidity position. The current ratio has increased from 2.95 in 2019 to 6.18 in 2023. This signifies that the company's current assets are more than sufficient to cover its current liabilities, providing a cushion to meet short-term obligations.
The significant rise in the current ratio from 2020 to 2023 reflects the company's enhanced ability to meet its short-term financial commitments. This improvement could be attributed to effective management of working capital, increased cash reserves, or a reduction in short-term debt levels.
A current ratio above 1.0 generally indicates that a company has enough current assets to cover its current liabilities. Cohu Inc's current ratio well above 1.0 for the past five years suggests a healthy liquidity position, which is important for the company's financial stability and ability to seize strategic opportunities or weather unexpected financial challenges.
Overall, the upward trend in Cohu Inc's current ratio reflects a positive liquidity position and a strong financial foundation which is beneficial for its overall financial health and stability.
Peer comparison
Dec 31, 2023