CTS Corporation (CTS)

Cash ratio

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Cash and cash equivalents	US$ in thousands	94,334	163,876	156,910	141,465	91,773
Short-term investments	US$ in thousands	—	1,121	1,561	—	—
Total current liabilities	US$ in thousands	97,553	97,039	112,532	114,066	104,932
Cash ratio		0.97	1.70	1.41	1.24	0.87

December 31, 2024 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($94,334K + $—K) ÷ $97,553K
= 0.97

The cash ratio of CTS Corporation has shown fluctuations over the past five years. Starting at 0.87 in December 31, 2020, it increased to 1.24 by December 31, 2021, indicating an improvement in the company's ability to cover its short-term liabilities with cash and cash equivalents. Subsequently, the ratio continued to rise, reaching 1.41 by December 31, 2022, and further increasing to 1.70 by December 31, 2023, demonstrating a strengthening liquidity position.

However, there was a slight decline in the cash ratio to 0.97 by December 31, 2024. This decrease may signal that the company's cash reserves relative to its current liabilities have diminished compared to the previous year. It is essential for CTS Corporation to closely monitor its cash position to ensure it maintains a healthy level of liquidity to meet its short-term obligations.

Overall, the upward trend in the cash ratio over the four-year period indicates an improvement in the company's liquidity position, although the slight decrease in the most recent year warrants attention and further analysis to understand the underlying reasons for the decline.