Copart Inc (CPRT)

Cash ratio

		Jul 31, 2023	Jul 31, 2022	Jul 31, 2021	Jul 31, 2020	Jul 31, 2019
Cash and cash equivalents	US$ in thousands	957,395	1,384,240	1,048,260	477,718	186,319
Short-term investments	US$ in thousands	1,406,590	—	—	—	—
Total current liabilities	US$ in thousands	492,769	440,889	421,031	356,044	282,004
Cash ratio		4.80	3.14	2.49	1.34	0.66

July 31, 2023 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($957,395K + $1,406,590K) ÷ $492,769K
= 4.80

The cash ratio of Copart, Inc. has shown a consistent increasing trend over the past five years, indicating an improving ability to cover its short-term liabilities with cash and cash equivalents. The ratio has increased from 0.99 in 2019 to 5.10 in 2023. This suggests that the company has significantly strengthened its ability to meet its short-term financial obligations using its readily available cash resources. The substantial increase in the cash ratio demonstrates Copart's enhanced liquidity position, which may provide the company with greater financial flexibility and resilience in the face of unexpected events or economic downturns. Overall, the trend in Copart's cash ratio reflects positively on the company's liquidity management.