Garmin Ltd (GRMN)

Quick ratio

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020
Cash	US$ in thousands	2,079,470	2,009,360	1,937,480	1,921,780	1,693,450	1,422,860	1,425,530	1,361,590	1,279,190	1,082,340	1,087,380	1,417,530	1,498,060	1,639,060	1,639,450	1,599,480	1,458,440	1,223,520	1,354,920	1,048,600
Short-term investments	US$ in thousands	421,270	414,701	288,659	274,579	274,618	273,050	253,689	188,878	173,288	378,705	526,639	375,237	347,980	345,214	330,567	342,656	387,642	430,164	380,880	391,646
Receivables	US$ in thousands	983,404	922,034	808,446	694,690	815,243	721,137	716,802	—	656,847	641,072	698,859	599,733	843,445	639,345	737,268	558,192	849,469	658,000	523,901	500,242
Total current liabilities	US$ in thousands	1,507,860	1,578,660	1,624,320	1,117,390	1,310,690	1,327,800	1,449,650	1,008,200	1,211,640	1,442,920	1,623,890	1,152,500	1,448,150	1,373,940	1,458,830	933,125	1,164,220	1,122,960	1,163,930	781,872
Quick ratio		2.31	2.12	1.87	2.59	2.12	1.82	1.65	1.54	1.74	1.46	1.42	2.08	1.86	1.91	1.86	2.68	2.32	2.06	1.94	2.48

December 31, 2024 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($2,079,470K + $421,270K + $983,404K) ÷ $1,507,860K
= 2.31

The quick ratio of Garmin Ltd has fluctuated over the observed period from March 31, 2020, to December 31, 2024. The quick ratio indicates the company's ability to meet its short-term obligations with its most liquid assets.

At March 31, 2020, the quick ratio was 2.48, which implies that the company had $2.48 in liquid assets available to cover every $1 of current liabilities. This ratio remained relatively stable for the next few quarters but experienced a decline to 1.86 by June 30, 2021. This lower ratio indicates a potential risk in meeting short-term obligations, as the company had $1.86 in liquid assets for every $1 of current liabilities.

Garmin's quick ratio improved to 2.08 by March 31, 2022, indicating a better ability to cover its short-term liabilities. However, the ratio dropped to 1.42 by June 30, 2022, signaling a decrease in the company's liquidity position. This could be a cause for concern as it implies that Garmin had a decrease in easily accessible assets relative to its short-term obligations.

The quick ratio trend continued to fluctuate, reaching a low of 1.42 by June 30, 2022, and a high of 2.59 by March 31, 2024. The ratio improved steadily in the latter part of the period, with a ratio of 2.31 by December 31, 2024, showing an increase in liquidity compared to the earlier quarters.

Overall, Garmin's quick ratio fluctuated during the period under review, with some quarters showing strong liquidity positions while others indicating a potential risk in meeting short-term obligations. Investors and stakeholders should closely monitor these fluctuations to assess the company's financial health and ability to manage its short-term obligations effectively.