Kratos Defense & Security Solutions (KTOS)
Cash ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 329,300 | 72,800 | 81,300 | 349,400 | 380,800 |
| Short-term investments | US$ in thousands | — | — | — | — | — |
| Total current liabilities | US$ in thousands | 296,700 | 292,500 | 234,200 | 221,100 | 197,600 |
| Cash ratio | 1.11 | 0.25 | 0.35 | 1.58 | 1.93 |
December 31, 2024 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($329,300K
+ $—K)
÷ $296,700K
= 1.11
The cash ratio of Kratos Defense & Security Solutions demonstrates notable fluctuations over the period from December 31, 2020, to December 31, 2024. At the end of 2020, the ratio stood at 1.93, indicating that the company held nearly double the amount of cash and cash equivalents relative to its current liabilities, reflecting a highly conservative liquidity position. By the end of 2021, the ratio decreased to 1.58, still maintaining a robust liquidity buffer but signaling a slight decline in immediate liquidity readiness.
A significant decline is observed by the end of 2022, when the cash ratio falls sharply to 0.35. This suggests the company's cash and cash equivalents covered only 35% of its current liabilities, indicating a reduction in immediate liquidity and potential increased reliance on other current assets for short-term obligations. The downward trend continued into 2023, with the ratio narrowing further to 0.25, signifying that cash holdings were only a quarter of current liabilities, which could raise concerns about liquidity adequacy in the short term.
However, in 2024, the cash ratio experienced a notable recovery, rising to 1.11. This improvement indicates that the company's cash and cash equivalents once again surpassed its current liabilities, reaching a more balanced and manageable liquidity position relative to prior years.
Overall, the analysis reveals a considerable decrease in Kratos' cash ratio from 2020 through 2023, reflecting a period of diminished immediate liquidity. The subsequent rebound in 2024 suggests a strategic strengthening of cash reserves or a shift in liquidity management, enhancing the company's capacity to meet short-term liabilities solely with its cash holdings.
Peer comparison
Dec 31, 2024