Graham Holdings Co (GHC)

Cash ratio

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Cash and cash equivalents	US$ in thousands	260,852	169,897	169,319	145,886	413,991
Short-term investments	US$ in thousands	858,743	697,028	622,408	824,445	587,582
Total current liabilities	US$ in thousands	1,199,800	1,229,680	1,174,010	1,166,340	949,646
Cash ratio		0.93	0.71	0.67	0.83	1.05

December 31, 2024 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($260,852K + $858,743K) ÷ $1,199,800K
= 0.93

The cash ratio of Graham Holdings Co has shown a fluctuating trend over the past five years. Starting at 1.05 in December 31, 2020, the ratio decreased to 0.83 by December 31, 2021, indicating a decrease in the company's ability to cover its short-term liabilities with its available cash. The ratio further dropped to 0.67 by December 31, 2022, reaching its lowest point during this period and highlighting a potential liquidity concern.

However, there was a slight improvement in the cash ratio to 0.71 by December 31, 2023, suggesting a modest increase in the company's liquidity position. Subsequently, by December 31, 2024, the cash ratio rose to 0.93, showing a significant improvement in the ability of Graham Holdings Co to cover its short-term obligations with its cash reserves.

Overall, while the company experienced some fluctuations in its cash ratio over the five-year period, the most recent data indicates an improvement in its liquidity position. It is essential for Graham Holdings Co to continue monitoring and managing its cash resources effectively to ensure its ability to meet its short-term financial obligations.