Digi International Inc (DGII)

Cash ratio

		Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	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
Cash and cash equivalents	US$ in thousands	27,510	28,337	23,795	31,548	31,693	29,580	31,660	30,949	34,900	41,515	41,386	47,188	152,432	146,942	127,189	49,263	54,129	55,085	58,086	49,072
Short-term investments	US$ in thousands	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Total current liabilities	US$ in thousands	89,337	82,353	81,134	70,445	85,978	89,019	83,769	90,565	96,507	94,578	89,977	79,311	58,941	57,415	56,861	67,487	61,230	50,345	53,206	61,525
Cash ratio		0.31	0.34	0.29	0.45	0.37	0.33	0.38	0.34	0.36	0.44	0.46	0.59	2.59	2.56	2.24	0.73	0.88	1.09	1.09	0.80

September 30, 2024 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($27,510K + $—K) ÷ $89,337K
= 0.31

The cash ratio measures a company's ability to cover its short-term liabilities with its cash and cash equivalents. A higher cash ratio indicates a stronger ability to pay off current debts if necessary.

Digi International Inc's cash ratio has fluctuated over the periods, ranging from 0.29 to 2.59. The company's cash ratio was relatively low in the first half of 2022, indicating lower cash reserves to cover short-term obligations. However, there was a significant increase in the cash ratio in the second half of 2022 and throughout 2023, reaching as high as 2.59 by September 2023, suggesting a substantial improvement in the company's liquidity position.

Subsequently, there was a decline in the cash ratio in 2024, although it remained above 0.2. The current cash ratio of 0.31 as of September 30, 2024, indicates that the company may have a moderate ability to cover short-term liabilities with its cash holdings.

Overall, while Digi International Inc experienced fluctuations in its cash ratio over the periods, the company has shown the ability to bolster its liquidity position during certain periods. However, it is essential for the company to closely monitor its cash reserves to ensure it can meet its short-term obligations effectively.