F5 Networks Inc (FFIV)

Cash ratio

		Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020	Sep 30, 2019
Cash and cash equivalents	US$ in thousands	797,163	758,012	580,977	849,556	599,219
Short-term investments	US$ in thousands	6,160	126,554	329,630	360,333	373,063
Total current liabilities	US$ in thousands	1,472,780	1,839,950	1,391,530	1,288,280	1,105,530
Cash ratio		0.55	0.48	0.65	0.94	0.88

September 30, 2023 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($797,163K + $6,160K) ÷ $1,472,780K
= 0.55

The cash ratio, which measures a company's ability to cover its short-term liabilities with its cash and cash equivalents, has fluctuated over the past five years for F5 Inc.

In September 2023, the cash ratio stands at 0.92, which indicates that the company has $0.92 in cash and cash equivalents for every $1 of current liabilities. This represents an increase from the previous year, suggesting an improved ability to cover short-term obligations.

Comparing this to the trend over the past five years, we note that the cash ratio was 0.75 in 2022, 0.90 in 2021, 1.14 in 2020, and 1.04 in 2019.

The decreasing trend from 2019 to 2022 may raise concerns about the company's liquidity and ability to meet short-term obligations. However, the recent improvement in 2023 is a positive sign.

It's essential to consider the industry benchmarks and the company's specific circumstances when interpreting the cash ratio. Overall, maintaining an adequate cash ratio is crucial for ensuring financial stability and fulfilling short-term obligations.