Jazz Pharmaceuticals PLC (JAZZ)
Current ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total current assets | US$ in thousands | 3,435,430 | 2,606,140 | 2,611,330 | 2,839,570 | 1,630,270 |
| Total current liabilities | US$ in thousands | 1,536,690 | 933,193 | 809,303 | 653,745 | 364,490 |
| Current ratio | 2.24 | 2.79 | 3.23 | 4.34 | 4.47 |
December 31, 2023 calculation
Current ratio = Total current assets ÷ Total current liabilities
= $3,435,430K ÷ $1,536,690K
= 2.24
The current ratio of Jazz Pharmaceuticals plc has exhibited a declining trend over the past five years. The ratio decreased from 4.47 in 2019 to 2.24 in 2023. This suggests a gradual weakening in the company's short-term liquidity position, indicating that its ability to cover immediate liabilities with current assets has diminished.
A current ratio below 1 typically raises concerns about a company's short-term solvency, while a ratio above 1 implies sufficient current assets to meet short-term obligations. Although Jazz Pharmaceuticals' current ratio is above 1 in all years, the downward trend signals a potential liquidity risk that investors and creditors may consider when evaluating the company's financial health.
It is important to further explore the reasons behind this decreasing trend to assess the company's ability to effectively manage its current assets and liabilities in the future.
Peer comparison
Dec 31, 2023