Fortinet Inc (FTNT)

Cash ratio

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Cash and cash equivalents	US$ in thousands	2,875,900	1,397,900	1,682,900	1,319,100	1,061,800
Short-term investments	US$ in thousands	1,190,600	1,042,500	528,100	1,232,600	775,500
Total current liabilities	US$ in thousands	4,060,700	3,719,000	3,078,400	2,318,100	1,829,500
Cash ratio		1.00	0.66	0.72	1.10	1.00

December 31, 2024 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($2,875,900K + $1,190,600K) ÷ $4,060,700K
= 1.00

The cash ratio of Fortinet Inc has shown some fluctuations over the last five years. It was at a solid level of 1.00 as of December 31, 2020, indicating that the company had sufficient cash to cover its current liabilities. Subsequently, the ratio increased to 1.10 by December 31, 2021, further improving its ability to meet short-term obligations.

However, there was a noticeable decline in the cash ratio to 0.72 by December 31, 2022, suggesting a decrease in the company's liquidity position. This reduction continued into the following year, with the ratio falling to 0.66 by December 31, 2023, indicating a potential strain on Fortinet's ability to cover immediate financial commitments purely with cash on hand.

Fortunately, the cash ratio rebounded to 1.00 by December 31, 2024, returning to a healthier level and indicating an improvement in Fortinet's liquidity position. Overall, the trend in the cash ratio reflects fluctuations in the company's ability to meet short-term obligations using its available cash resources.