IPG Photonics Corporation (IPGP)

Current 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
Total current assets	US$ in thousands	1,914,650	1,920,460	1,924,070	1,915,590	1,986,270	2,119,090	2,170,850	2,282,830	2,347,680	2,325,180	2,290,590	2,202,260	2,148,080	2,031,650	1,950,530	1,874,530	1,896,630	1,865,520	1,863,080	1,792,090
Total current liabilities	US$ in thousands	214,861	219,709	228,187	249,522	274,646	295,788	315,902	279,836	313,433	292,840	255,905	214,753	214,578	201,445	195,286	195,432	191,904	205,563	222,228	209,816
Current ratio		8.91	8.74	8.43	7.68	7.23	7.16	6.87	8.16	7.49	7.94	8.95	10.25	10.01	10.09	9.99	9.59	9.88	9.08	8.38	8.54

December 31, 2023 calculation

Current ratio = Total current assets ÷ Total current liabilities
= $1,914,650K ÷ $214,861K
= 8.91

Based on the data provided, the current ratio of IPG Photonics Corp has been consistently high over the quarters, ranging from 6.87 to 8.91. This indicates that the company has a strong ability to cover its short-term liabilities with its current assets. The increasing trend in the current ratio from Q1 2022 to Q4 2023 suggests that the company's liquidity position has been improving over time.

A current ratio above 1 is generally considered healthy, and IPG Photonics Corp's current ratios well above 1 indicate a robust liquidity position. A high current ratio can be a positive indication of the company's ability to meet its short-term obligations and potentially take advantage of investment opportunities or cover unforeseen expenses.

However, it is essential to note that while a high current ratio is generally positive, an extremely high ratio may also indicate that the company is not efficiently using its current assets to generate revenue or is not investing excess cash effectively. Monitoring the trend of the current ratio over time and comparing it to industry benchmarks can provide deeper insights into IPG Photonics Corp's financial health and management of liquidity.