Eagle Materials Inc (EXP)
Cash ratio
| Mar 31, 2024 | Mar 31, 2023 | Mar 31, 2022 | Mar 31, 2021 | Mar 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 34,925 | 15,242 | 19,416 | 263,520 | 118,648 |
| Short-term investments | US$ in thousands | — | — | — | 18,031 | — |
| Total current liabilities | US$ in thousands | 239,409 | 212,889 | 207,551 | 169,354 | 169,697 |
| Cash ratio | 0.15 | 0.07 | 0.09 | 1.66 | 0.70 |
March 31, 2024 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($34,925K
+ $—K)
÷ $239,409K
= 0.15
The cash ratio of Eagle Materials Inc has fluctuated over the past five years, indicating varying liquidity levels. The ratio was at its highest in March 2021 at 1.66, which suggests that the company had $1.66 in liquid assets available to cover each dollar of current liabilities. This high ratio indicates a strong ability to meet short-term obligations using cash or cash equivalents.
However, the cash ratio dropped significantly in the following years, reaching its lowest point in March 2023 at 0.07. This sharp decrease may raise concerns about the company's liquidity position and its ability to cover short-term liabilities with its available cash reserves.
The cash ratio improved slightly in the subsequent years but remained relatively low compared to 2021. As of March 31, 2024, the cash ratio stands at 0.15, which indicates a moderate ability to meet current obligations from cash and cash equivalents.
Overall, while the company experienced a peak in liquidity in 2021, the subsequent years demonstrated a decrease in the cash ratio, suggesting potential challenges in meeting short-term financial obligations solely through available cash resources. Management may need to monitor and potentially improve the company's liquidity position to ensure continued financial stability.