Kennametal Inc (KMT)
Quick ratio
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 127,971 | 106,021 | 85,586 | 154,047 | 606,684 |
| Short-term investments | US$ in thousands | — | — | — | — | — |
| Receivables | US$ in thousands | 302,810 | 307,313 | 295,346 | 302,945 | 237,983 |
| Total current liabilities | US$ in thousands | 415,961 | 433,975 | 485,649 | 437,394 | 898,080 |
| Quick ratio | 1.04 | 0.95 | 0.78 | 1.04 | 0.94 |
June 30, 2024 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($127,971K
+ $—K
+ $302,810K)
÷ $415,961K
= 1.04
The quick ratio, also known as the acid-test ratio, measures a company's ability to meet its short-term liabilities with its most liquid assets. A quick ratio of 1 indicates that a company can fully cover its current liabilities with its quick assets.
In the case of Kennametal Inc, the quick ratio has fluctuated over the past five years. In 2024, the quick ratio stands at 1.04, indicating that the company has adequate liquid assets to cover its current liabilities. This improvement from the previous year's ratio of 0.95 suggests a stronger liquidity position.
Looking back at previous years, the quick ratio was 0.78 in 2022, showing a lower ability to cover short-term obligations with quick assets. The ratios of 1.04 in 2021 and 0.94 in 2020 also displayed varying levels of liquidity over those years.
Overall, while the quick ratio for Kennametal Inc has shown fluctuations, the current ratio of 1.04 for 2024 indicates an improved ability to meet short-term obligations with available liquid assets compared to the previous year. However, it is essential to consider other liquidity ratios and factors to get a complete picture of the company's financial health.