Lithia Motors Inc (LAD)

Quick ratio

Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020
Cash US$ in thousands 225,100 209,800 516,400 264,400 972,000 146,900 88,700 184,900 271,500 172,700 64,400 131,600 153,000 137,800 780,900 170,300 160,200 57,100 120,300 56,600
Short-term investments US$ in thousands 2,200 2,200 2,100 — 0 — — — — — — — — — — — — — — —
Receivables US$ in thousands 1,245,700 1,209,400 1,242,900 1,249,300 1,123,100 999,300 884,600 843,100 813,100 1,004,600 978,400 923,800 910,000 812,600 799,700 740,700 614,000 511,700 446,400 298,200
Total current liabilities US$ in thousands 6,551,100 6,664,100 7,019,900 6,591,500 4,932,200 4,375,300 4,048,200 3,948,000 3,178,200 2,826,600 2,614,400 2,825,100 2,402,800 2,181,800 2,595,800 2,610,900 2,479,700 2,212,400 2,026,400 2,431,500
Quick ratio 0.22 0.21 0.25 0.23 0.42 0.26 0.24 0.26 0.34 0.42 0.40 0.37 0.44 0.44 0.61 0.35 0.31 0.26 0.28 0.15

December 31, 2024 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($225,100K + $2,200K + $1,245,700K) ÷ $6,551,100K
= 0.22

The quick ratio of Lithia Motors Inc has shown fluctuations over the period from March 31, 2020, to December 31, 2024. The ratio started at a low point of 0.15 on March 31, 2020, indicating a limited ability to cover its short-term liabilities with its most liquid assets.

However, there was an improvement in the quick ratio to 0.61 on June 30, 2021, showing a significant increase in liquidity. This suggests that the company had a stronger ability to meet its short-term obligations with its quick assets, such as cash and accounts receivable.

The ratio then fluctuated between 0.26 and 0.44 from September 30, 2021, to December 31, 2022, before declining to 0.23 on March 31, 2023. This decrease may indicate potential liquidity challenges for the company.

Over the subsequent periods up to December 31, 2024, the quick ratio fluctuated between 0.21 and 0.42. The ratio reached its peak at 0.42 on December 31, 2023, suggesting improved liquidity, but it dropped to 0.22 by December 31, 2024.

Overall, the trend in the quick ratio of Lithia Motors Inc shows some variability, with periods of both strength and potential liquidity challenges. Monitoring this ratio, especially in relation to industry benchmarks, can provide valuable insights into the company's short-term liquidity position.