GameStop Corp (GME)
Cash ratio
| Feb 3, 2024 | Jan 28, 2023 | Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 921,700 | 1,139,000 | 1,271,400 | 508,500 | 499,400 |
| Short-term investments | US$ in thousands | 277,600 | 251,600 | 0 | — | 165,200 |
| Total current liabilities | US$ in thousands | 934,500 | 1,339,100 | 1,354,700 | 1,342,700 | 1,237,700 |
| Cash ratio | 1.28 | 1.04 | 0.94 | 0.38 | 0.54 |
February 3, 2024 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($921,700K
+ $277,600K)
÷ $934,500K
= 1.28
The cash ratio of GameStop Corp has exhibited an increasing trend over the past five years, indicating a strengthening liquidity position. The ratio has improved from 0.54 in February 2020 to 1.28 in February 2024. This suggests that the company has more cash and cash equivalents available to cover its short-term obligations. A higher cash ratio indicates a company's ability to meet its current liabilities using its readily available cash, which is generally viewed positively by investors and creditors. GameStop Corp's consistent improvement in its cash ratio demonstrates enhanced financial health and liquidity management over the period under review.