Generac Holdings Inc (GNRC)
Cash ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 281,277 | 200,994 | 132,723 | 147,339 | 655,128 |
| Short-term investments | US$ in thousands | — | — | — | — | — |
| Total current liabilities | US$ in thousands | 1,033,150 | 880,771 | 992,044 | 1,155,910 | 641,524 |
| Cash ratio | 0.27 | 0.23 | 0.13 | 0.13 | 1.02 |
December 31, 2024 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($281,277K
+ $—K)
÷ $1,033,150K
= 0.27
The cash ratio of Generac Holdings Inc has fluctuated over the years, reflecting the company's ability to cover its short-term liabilities with its readily available cash and cash equivalents. As of December 31, 2020, the cash ratio stood at a healthy 1.02, indicating that the company had more than enough cash to cover its short-term obligations. However, in the subsequent years, the cash ratio decreased significantly to 0.13 by December 31, 2021 and remained at the same level by December 31, 2022.
This sharp decline in the cash ratio may suggest that Generac Holdings Inc faced challenges in maintaining sufficient liquidity compared to its short-term liabilities during these periods. However, the cash ratio improved slightly to 0.23 by December 31, 2023 and further increased to 0.27 by December 31, 2024. These improvements indicate that the company potentially strengthened its cash position relative to its short-term obligations in the later years.
Overall, monitoring the cash ratio of Generac Holdings Inc can provide insights into its liquidity management practices and its ability to meet short-term financial commitments with available cash resources.
Peer comparison
Dec 31, 2024