FormFactor Inc (FORM)

Quick ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cash	US$ in thousands	177,812	109,130	151,010	187,225	144,545
Short-term investments	US$ in thousands	150,507	129,006	125,055	67,810	76,327
Receivables	US$ in thousands	102,957	88,143	115,541	107,603	97,868
Total current liabilities	US$ in thousands	131,095	149,667	148,754	154,571	136,560
Quick ratio		3.29	2.18	2.63	2.35	2.33

December 31, 2023 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($177,812K + $150,507K + $102,957K) ÷ $131,095K
= 3.29

FormFactor Inc's quick ratio has shown a fluctuating trend over the past five years. The quick ratio measures the ability of a company to meet its short-term obligations with its most liquid assets, excluding inventory.

In 2023, FormFactor Inc's quick ratio improved significantly to 3.29, indicating a stronger ability to cover its short-term liabilities with quick assets. This increase suggests the company may have improved its liquidity position and has a comfortable cushion to meet its upcoming financial obligations.

Comparing this to the previous years, we observe a positive progression in the quick ratio from 2019 to 2020, followed by a slight dip in 2021, a notable increase in 2022, and the substantial improvement in 2023. This fluctuation may be influenced by various factors such as changes in current assets composition, liabilities management, or operational efficiency.

Overall, the increasing trend in FormFactor Inc's quick ratio implies a favorable liquidity position, indicating the company's ability to meet its short-term obligations efficiently. However, it is essential to consider other financial metrics and factors to get a holistic view of the company's financial health.