Fabrinet (FN)
Cash ratio
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 409,973 | 231,368 | 197,996 | 302,969 | 225,430 |
| Short-term investments | US$ in thousands | 448,630 | 319,100 | 280,157 | 244,963 | 262,693 |
| Total current liabilities | US$ in thousands | 557,942 | 481,885 | 538,487 | 444,358 | 334,421 |
| Cash ratio | 1.54 | 1.14 | 0.89 | 1.23 | 1.46 |
June 30, 2024 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($409,973K
+ $448,630K)
÷ $557,942K
= 1.54
The cash ratio of Fabrinet has been fluctuating over the past five years, as indicated by the values of 1.54, 1.14, 0.89, 1.23, and 1.46 for the years ending June 30, 2024, 2023, 2022, 2021, and 2020, respectively. The cash ratio measures a company's ability to cover its short-term liabilities using its cash and cash equivalents.
A higher cash ratio indicates a stronger liquidity position as the company has more cash on hand relative to its current liabilities. Fabrinet's cash ratio has shown an increasing trend from 2022 to 2024, suggesting an improvement in its ability to meet short-term obligations with its available cash resources.
However, it's important to note that a very high cash ratio may also signal that the company is not efficiently utilizing its cash and could potentially invest it in projects that yield a higher return. Conversely, a low cash ratio may indicate liquidity challenges in meeting short-term obligations. Fabrinet's cash ratio performance should be analyzed in conjunction with other financial ratios and key performance indicators for a more comprehensive assessment of its financial health and operational efficiency.
Peer comparison
Jun 30, 2024