Fulgent Genetics Inc (FLGT)

Cash ratio

Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Cash and cash equivalents US$ in thousands 55,144 97,473 79,506 164,894 87,426
Short-term investments US$ in thousands 202,962 326,681 773,377 770,652 344,443
Total current liabilities US$ in thousands 72,899 73,018 116,178 112,840 131,074
Cash ratio 3.54 5.81 7.34 8.29 3.29

December 31, 2024 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($55,144K + $202,962K) ÷ $72,899K
= 3.54

The cash ratio for Fulgent Genetics Inc has shown a fluctuating trend over the five-year period from December 31, 2020, to December 31, 2024. The ratio increased significantly from 3.29 in 2020 to 8.29 in 2021, indicating a strong ability to cover short-term liabilities with cash and cash equivalents. However, in the following years, the cash ratio exhibited some degree of volatility, with values of 7.34 in 2022, 5.81 in 2023, and finally decreasing to 3.54 in 2024.

Overall, a higher cash ratio signifies a company's capacity to meet its immediate obligations without relying on external sources. The initial spike in the cash ratio in 2021 suggests a robust liquidity position, but the subsequent decline in the ratio in the later years may signal potential changes in the company's cash management or investment strategies. It is important for Fulgent Genetics Inc to maintain a balance between liquidity and investment opportunities to ensure financial stability and flexibility.