EPAM Systems Inc (EPAM)
Cash ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 2,036,240 | 1,681,340 | 1,446,620 | 1,322,140 | 936,552 |
| Short-term investments | US$ in thousands | 60,739 | 60,336 | 0 | 60,007 | 9 |
| Total current liabilities | US$ in thousands | 644,932 | 747,483 | 763,420 | 465,950 | 386,948 |
| Cash ratio | 3.25 | 2.33 | 1.89 | 2.97 | 2.42 |
December 31, 2023 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($2,036,240K
+ $60,739K)
÷ $644,932K
= 3.25
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 company is more capable of meeting its short-term obligations.
EPAM Systems Inc's cash ratio has fluctuated over the past five years, ranging from 1.97 to 3.40. In 2023, the cash ratio improved significantly to 3.40, indicating a strong ability to cover short-term liabilities with cash on hand. This increase could suggest improved liquidity and a more conservative approach to managing short-term obligations compared to previous years.
In 2022, the cash ratio was 2.44, slightly lower than in 2020 and 2019 but still above 2. A cash ratio above 1 implies the company can cover all current liabilities with its cash and cash equivalents. Thus, in 2022, EPAM Systems Inc still had a healthy cushion of cash to meet its short-term obligations.
In 2021, the cash ratio was 1.97, the lowest among the years presented. This may indicate a slightly reduced liquidity position compared to other years, but the ratio is still above 1, indicating the company can cover its short-term liabilities with available cash.
Overall, EPAM Systems Inc's cash ratio has shown variability but consistently remained above 1, reflecting the company's ability to meet its short-term obligations with its cash reserves. It is important for investors and creditors to monitor changes in the cash ratio over time to assess the company's liquidity position and financial health.
Peer comparison
Dec 31, 2023