DigitalOcean Holdings Inc (DOCN)
Cash ratio
| 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 419,063 | 317,236 | 79,361 | 120,045 | 20,872 | 140,772 | 24,115 | 72,177 | 464,836 | 1,713,390 | 589,750 | 577,218 | 560,053 |
| Short-term investments | US$ in thousands | 0 | 94,532 | 304,720 | 430,462 | 591,681 | 723,462 | 800,539 | 1,093,980 | 1,090,370 | 0 | — | — | — |
| Total current liabilities | US$ in thousands | 188,951 | 192,645 | 184,289 | 167,311 | 54,240 | 165,516 | 98,808 | 74,227 | 62,451 | 58,239 | 57,577 | 55,387 | 46,049 |
| Cash ratio | 2.22 | 2.14 | 2.08 | 3.29 | 11.29 | 5.22 | 8.35 | 15.71 | 24.90 | 29.42 | 10.24 | 10.42 | 12.16 |
March 31, 2024 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($419,063K
+ $0K)
÷ $188,951K
= 2.22
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 liquidity position.
DigitalOcean Holdings Inc's cash ratio fluctuated over the observed periods, ranging from a low of 2.08 in September 2023 to a high of 29.42 in March 2022. The most recent data point, as of March 31, 2024, shows a cash ratio of 2.22, which indicates that the company holds $2.22 in cash and cash equivalents for every $1 of current liabilities.
The significant variations in the cash ratio over time could be due to changes in the company's cash position and short-term liabilities. A declining trend in the cash ratio may suggest a decreased ability to cover short-term obligations with available cash, which could raise concerns about liquidity risk. Conversely, a rising trend or consistently high cash ratio reflects a healthier liquidity position.
Overall, the analysis of DigitalOcean Holdings Inc's cash ratio suggests that the company generally maintains a strong ability to meet its short-term liabilities with cash on hand, although it is essential to monitor trends over time to ensure sustainable liquidity management.
Peer comparison
Mar 31, 2024