Alphabet Inc Class A (GOOGL)
Cash ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 23,466,000 | 24,048,000 | 21,879,000 | 20,945,000 | 26,465,000 |
| Short-term investments | US$ in thousands | 72,191,000 | 86,868,000 | 91,883,000 | 118,704,000 | 110,229,000 |
| Total current liabilities | US$ in thousands | 89,122,000 | 81,814,000 | 69,300,000 | 64,254,000 | 56,834,000 |
| Cash ratio | 1.07 | 1.36 | 1.64 | 2.17 | 2.41 |
December 31, 2024 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($23,466,000K
+ $72,191,000K)
÷ $89,122,000K
= 1.07
The cash ratio measures a company's ability to cover its short-term liabilities with its cash and cash equivalents. For Alphabet Inc Class A, the cash ratio has decreased over the years, declining from 2.41 in December 31, 2020, to 1.07 in December 31, 2024. This suggests a decreasing ability to meet short-term obligations solely with cash on hand. It is important to note that a higher cash ratio is generally preferred as it indicates a stronger liquidity position for the company. The decreasing trend observed in Alphabet Inc Class A's cash ratio may raise concerns about its liquidity management and ability to quickly address short-term financial needs. Investors and analysts should further investigate the factors contributing to this decline to assess the company's financial health and risk profile accurately.
Peer comparison
Dec 31, 2024