Inter Parfums Inc (IPAR)
Cash ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 88,462 | 104,713 | 159,613 | 169,681 | 133,417 |
| Short-term investments | US$ in thousands | 94,304 | 150,833 | 160,014 | 126,627 | 119,714 |
| Total current liabilities | US$ in thousands | 324,745 | 344,567 | 244,910 | 156,205 | 184,465 |
| Cash ratio | 0.56 | 0.74 | 1.31 | 1.90 | 1.37 |
December 31, 2023 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($88,462K
+ $94,304K)
÷ $324,745K
= 0.56
The cash ratio of Inter Parfums, Inc. has shown a decreasing trend over the past five years, declining from 2.01 in 2020 to 0.65 in 2023. This indicates that the company has less cash and cash equivalents relative to its current liabilities in recent years. A cash ratio below 1 suggests that the company may have difficulty meeting its short-term obligations solely with its existing cash resources.
While a decreasing cash ratio can raise concerns about liquidity and the ability to cover immediate liabilities, it is essential to consider the industry norms and the company's overall financial health. It would be advisable for Inter Parfums, Inc. to closely monitor its cash position and explore strategies to improve liquidity management to ensure it can meet its short-term obligations effectively in the future.
Peer comparison
Dec 31, 2023