CarMax Inc (KMX)

Cash ratio

		Feb 29, 2024	Feb 28, 2023	Feb 28, 2022	Feb 28, 2021	Feb 29, 2020
Cash and cash equivalents	US$ in thousands	574,142	314,758	102,716	132,319	58,211
Short-term investments	US$ in thousands	—	—	—	—	—
Total current liabilities	US$ in thousands	2,312,290	1,938,310	2,047,460	1,698,550	1,534,710
Cash ratio		0.25	0.16	0.05	0.08	0.04

February 29, 2024 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($574,142K + $—K) ÷ $2,312,290K
= 0.25

The cash ratio of CarMax Inc has shown a positive trend over the past five years, indicating an improvement in the company's ability to meet its short-term financial obligations using cash and cash equivalents.

In the most recent fiscal year ending on February 29, 2024, the cash ratio stood at 0.25, increasing from 0.16 in the previous year. This suggests that CarMax has significantly strengthened its liquidity position compared to the prior year.

Furthermore, the cash ratio has shown a consistent upward trajectory since February 28, 2020, when it was at 0.04. This steady improvement signifies the company's enhanced ability to cover its current liabilities solely with its readily available cash resources.

Overall, CarMax Inc's cash ratio demonstrates a positive trend, indicating a healthy liquidity position and a strengthened ability to fulfill short-term financial obligations using cash and cash equivalents.