KB Home (KBH)

Quick ratio

		Nov 30, 2024	Nov 30, 2023	Nov 30, 2022	Nov 30, 2021	Nov 30, 2020
Cash	US$ in thousands	599,193	727,342	330,198	292,136	682,529
Short-term investments	US$ in thousands	—	-34,400	46,785	—	—
Receivables	US$ in thousands	—	—	—	—	—
Total current liabilities	US$ in thousands	—	810,860	1,149,500	1,128,730	940,869
Quick ratio		—	0.85	0.33	0.26	0.73

November 30, 2024 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($599,193K + $—K + $—K) ÷ $—K
= —

The quick ratio, also known as the acid-test ratio, measures a company's ability to meet its short-term obligations with its most liquid assets. A quick ratio of 1 or above is generally considered healthy, as it indicates that the company can cover its current liabilities without relying on the sale of inventory.

Based on the data provided for KB Home, the trend in the quick ratio over the years shows some fluctuations. As of November 30, 2020, the quick ratio was 0.73, which means that for every dollar of current liabilities, the company had $0.73 of quick assets available. This indicates a reasonable level of liquidity at that time.

However, the quick ratio dropped significantly to 0.26 as of November 30, 2021. This sharp decrease may signify potential liquidity challenges, as the company's ability to cover its short-term obligations with its most liquid assets weakened substantially.

In the following years, the quick ratio improved slightly to 0.33 as of November 30, 2022, suggesting a slight recovery in liquidity. By November 30, 2023, the quick ratio increased significantly to 0.85, showing a healthier liquidity position and a more comfortable ability to meet short-term obligations.

The absence of a quick ratio for November 30, 2024, signifies that the data is unavailable for that period. It would be essential for stakeholders to monitor future financial reports to assess the company's liquidity position and its ability to manage short-term obligations effectively.

In conclusion, while the quick ratio for KB Home has shown fluctuations over the years, it is crucial for investors and analysts to closely monitor this ratio to evaluate the company's short-term liquidity and financial health.