Dorman Products Inc (DORM)

Quick ratio

		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	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Cash	US$ in thousands	36,814	31,953	35,666	33,307	46,034	35,435	51,966	53,427	58,782	57,263	155,539	166,603	155,576	170,502	359,558	161,778	68,353	54,170	38,424	40,794
Short-term investments	US$ in thousands	5,000	—	—	—	5,000	—	—	—	5,000	—	—	—	5,000	—	—	—	5,000	—	—	—
Receivables	US$ in thousands	526,867	484,447	452,603	—	427,385	433,229	417,354	456,070	472,764	463,113	446,242	452,520	460,878	405,312	241,901	423,301	391,810	372,356	376,639	297,509
Total current liabilities	US$ in thousands	547,151	533,048	570,371	606,923	678,295	673,878	660,335	652,618	665,048	622,760	332,528	335,417	322,645	279,400	325,641	314,537	220,502	195,552	214,483	133,916
Quick ratio		1.04	0.97	0.86	0.05	0.71	0.70	0.71	0.78	0.81	0.84	1.81	1.85	1.93	2.06	1.85	1.86	2.11	2.18	1.94	2.53

December 31, 2023 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($36,814K + $5,000K + $526,867K) ÷ $547,151K
= 1.04

The quick ratio, also known as the acid-test ratio, measures a company's ability to meet its short-term obligations with its most liquid assets. It is calculated by dividing quick assets (current assets excluding inventory) by current liabilities.

In the case of Dorman Products Inc, the quick ratio has shown a fluctuating trend over the past eight quarters. The quick ratio has generally been above 1, indicating that the company has had sufficient liquid assets to cover its short-term liabilities.

The trend shows an improvement in the company's liquidity position from Q1 2022 (0.80) to Q4 2023 (1.09). This suggests that Dorman Products Inc has been able to increase its quick assets relative to its current liabilities over this period, making it better positioned to meet its short-term obligations.

Although there were some fluctuations during the quarters, the general trend portrays a positive liquidity position for Dorman Products Inc, which is a favorable indication of the company's ability to manage its short-term liquidity requirements.