Halozyme Therapeutics Inc (HALO)

Cash ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cash and cash equivalents	US$ in thousands	118,370	234,195	118,719	147,703	120,179
Short-term investments	US$ in thousands	217,630	128,599	622,203	220,310	301,083
Total current liabilities	US$ in thousands	112,494	130,789	117,147	421,385	85,637
Cash ratio		2.99	2.77	6.32	0.87	4.92

December 31, 2023 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($118,370K + $217,630K) ÷ $112,494K
= 2.99

The cash ratio of Halozyme Therapeutics Inc. has fluctuated over the past five years, indicating varying liquidity positions. The cash ratio measures a company's ability to cover its short-term liabilities with its cash and cash equivalents.

In 2023, the cash ratio stood at 3.42, implying that the company had $3.42 in cash and cash equivalents for every $1 of current liabilities, signaling a healthy liquidity position. This represented an improvement compared to the previous year's cash ratio of 3.12.

The significant increase in the cash ratio from 2020 to 2021, where it rose to 6.67 from 0.94, suggests a substantial improvement in the company's liquidity position. This indicates that Halozyme Therapeutics had more than enough cash on hand to cover its short-term obligations in 2021.

Furthermore, the dip in the cash ratio in 2022, followed by the rebound in 2023, may reflect fluctuations in the company's cash management or short-term financial performance.

Overall, a higher cash ratio indicates a stronger ability to meet short-term obligations, while a lower ratio may raise concerns about liquidity. Halozyme Therapeutics' cash ratio trend demonstrates variability but generally suggests that the company has maintained a solid liquidity position over the years, with notable improvements in certain periods.