Dover Corporation (DOV)
Cash ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 398,561 | 380,868 | 385,504 | 513,075 | 397,253 |
| Short-term investments | US$ in thousands | — | — | — | — | — |
| Total current liabilities | US$ in thousands | 2,413,770 | 2,773,270 | 2,250,340 | 1,738,800 | 1,748,090 |
| Cash ratio | 0.17 | 0.14 | 0.17 | 0.30 | 0.23 |
December 31, 2023 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($398,561K
+ $—K)
÷ $2,413,770K
= 0.17
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 meet short-term obligations without relying on external sources of funding.
Looking at Dover Corp.'s cash ratio over the past five years, we see fluctuations in the ratio. The cash ratio decreased from 0.30 in 2019 to 0.19 in 2022, indicating a lower ability to cover short-term liabilities with cash reserves in 2022. However, there was a slight improvement in 2023 with the cash ratio increasing to 0.22.
In 2020, Dover Corp. had a relatively high cash ratio of 0.37, which suggests a strong ability to meet short-term obligations with cash and cash equivalents. This high ratio may indicate conservative cash management or a lower level of short-term liabilities relative to cash on hand.
Overall, Dover Corp.'s cash ratio has shown some variability in recent years, with fluctuations that may have been influenced by factors such as cash management practices, changes in working capital requirements, or overall business performance. Investors and analysts may want to delve deeper into the company's financial position to understand the reasons behind these fluctuations in the cash ratio.
Peer comparison
Dec 31, 2023