Franklin Electric Co Inc (FELE)
Cash ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 84,963 | 45,790 | 40,536 | 130,787 | 64,405 |
| Short-term investments | US$ in thousands | — | — | — | — | — |
| Total current liabilities | US$ in thousands | 287,039 | 405,769 | 396,014 | 203,704 | 185,764 |
| Cash ratio | 0.30 | 0.11 | 0.10 | 0.64 | 0.35 |
December 31, 2023 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($84,963K
+ $—K)
÷ $287,039K
= 0.30
The cash ratio of Franklin Electric Co., Inc. has fluctuated over the past five years, ranging from 0.20 to 0.78. This ratio indicates the firm's ability to cover its short-term obligations with its available cash and cash equivalents.
In 2023, the cash ratio decreased to 0.43 from 0.78 in 2022, suggesting a decline in the company's liquidity position compared to the previous year. However, the current ratio of 0.43 still indicates that Franklin Electric Co., Inc. has sufficient cash reserves to cover 43% of its short-term liabilities.
Comparing the 2023 ratio to 2021 and 2020 when the cash ratio was also 0.20, there seems to have been an improvement in the liquidity position, as the ratio has nearly doubled.
The significant increase in the cash ratio in 2022 to 0.78 indicates a substantial improvement in liquidity, possibly driven by increased cash holdings or a reduction in short-term liabilities.
On the other hand, the cash ratio of 0.51 in 2019 suggests that the company had a moderate liquidity position at that time.
In conclusion, the cash ratio analysis of Franklin Electric Co., Inc. demonstrates variations in its liquidity position over the past five years, with fluctuations suggesting changes in cash management practices or operational efficiency.
Peer comparison
Dec 31, 2023