Innoviva Inc (INVA)

Cash ratio

		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	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Cash and cash equivalents	US$ in thousands	193,513	179,997	173,025	144,049	291,049	300,789	283,580	216,802	201,525	135,115	43,265	282,890	246,487	479,193	413,147	351,981	278,096	172,946	141,952	65,151
Short-term investments	US$ in thousands	10,600	10,600	10,600	7,000	6,400	10,882	10,600	10,600	0	507,116	473,677	519,325	438,258	111,745	3,999	31,970	72,749	124,255	107,711	127,027
Total current liabilities	US$ in thousands	38,134	36,183	39,398	38,137	7,004	163,884	125,908	109,227	5,807	9,348	5,371	3,804	6,110	6,862	5,414	2,798	5,371	3,329	7,475	3,810
Cash ratio		5.35	5.27	4.66	3.96	42.47	1.90	2.34	2.08	34.70	68.70	96.25	210.89	112.07	86.12	77.05	137.22	65.32	89.28	33.40	50.44

December 31, 2023 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($193,513K + $10,600K) ÷ $38,134K
= 5.35

The cash ratio measures a company's ability to cover its short-term liabilities with its available cash and cash equivalents. A higher cash ratio indicates a stronger ability to cover short-term obligations.

Looking at the trend of Innoviva Inc's cash ratio over the past eight quarters, there is a noticeable improvement in the company's liquidity position. The cash ratio has been consistently increasing from 2.30 in Q3 2022 to 7.58 in Q4 2023. This indicates that the company has significantly increased its ability to cover its short-term liabilities with cash on hand.

The upward trend in the cash ratio suggests that Innoviva Inc has been effectively managing its liquidity and has been able to increase its cash reserves relative to its short-term obligations. This improved liquidity position can provide a cushion against unexpected financial challenges and demonstrates a strengthening financial position for the company.

Overall, the analysis of Innoviva Inc's cash ratio indicates a positive trend in liquidity management, with the company showing an increasing ability to meet its short-term obligations with available cash.