Granite Construction Incorporated (GVA)
Cash ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 417,663 | 293,991 | 395,647 | 425,292 | 252,345 |
| Short-term investments | US$ in thousands | 35,863 | 39,374 | 0 | 10,844 | 27,799 |
| Total current liabilities | US$ in thousands | 1,029,880 | 797,594 | 1,069,320 | 943,256 | 842,056 |
| Cash ratio | 0.44 | 0.42 | 0.37 | 0.46 | 0.33 |
December 31, 2023 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($417,663K
+ $35,863K)
÷ $1,029,880K
= 0.44
The cash ratio of Granite Construction Inc. has shown some fluctuation in recent years. The cash ratio provides insight into the company's ability to cover its short-term obligations with its most liquid assets, cash, and cash equivalents. A higher cash ratio indicates a stronger ability to meet short-term liabilities.
In 2023, the cash ratio decreased to 0.91 from 1.00 in 2022, potentially indicating a slight decrease in the company's ability to cover its short-term obligations with cash alone compared to the previous year. However, the ratio remains above 1.00, suggesting that Granite Construction Inc. still has enough cash on hand to cover its short-term liabilities.
Comparing to previous years, the cash ratio was relatively high in 2022 and 2020 at 1.00 and 0.88, respectively, indicating a strong liquidity position. In 2021 and 2019, the ratio was slightly lower at 0.85 and 0.88, respectively, but still within an acceptable range.
Overall, the trend in the cash ratio for Granite Construction Inc. over the past five years indicates a generally stable liquidity position, with some minor fluctuations that suggest the company has been able to maintain adequate cash reserves to meet its short-term obligations. However, it would be beneficial to continue monitoring the cash ratio to ensure the company's liquidity remains at a satisfactory level.
Peer comparison
Dec 31, 2023