Hexcel Corporation (HXL)

Quick ratio

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Cash	US$ in thousands	125,400	227,000	112,000	127,700	103,300
Short-term investments	US$ in thousands	—	4,300	6,200	—	44,000
Receivables	US$ in thousands	212,000	234,700	222,700	160,300	125,400
Total current liabilities	US$ in thousands	353,500	315,900	329,800	247,600	183,100
Quick ratio		0.95	1.48	1.03	1.16	1.49

December 31, 2024 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($125,400K + $—K + $212,000K) ÷ $353,500K
= 0.95

The quick ratio of Hexcel Corporation has fluctuated over the past five years. It was 1.49 as of December 31, 2020, indicating that the company had $1.49 in liquid assets available to cover each $1 of current liabilities. However, this ratio decreased to 1.16 by December 31, 2021, and further declined to 1.03 by December 31, 2022, suggesting a potential strain on the company's ability to meet its short-term obligations without relying on inventory.

There was a notable improvement in the quick ratio by December 31, 2023, where it increased to 1.48, showing a stronger liquidity position. This improvement may indicate a better ability to meet short-term liabilities using liquid assets. Nonetheless, by December 31, 2024, the quick ratio dropped to 0.95, which could raise concerns about the company's short-term liquidity and ability to cover immediate obligations.

It is important for stakeholders to monitor Hexcel Corporation's quick ratio closely to ensure that the company maintains a healthy balance between liquid assets and current liabilities to weather potential financial challenges and meet its short-term obligations effectively.