LGI Homes (LGIH)
Quick ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 53,197 | 48,978 | 31,998 | 50,514 | 35,942 |
| Short-term investments | US$ in thousands | — | — | — | — | — |
| Receivables | US$ in thousands | — | — | — | — | — |
| Total current liabilities | US$ in thousands | 137,926 | 235,484 | 365,415 | 150,781 | 148,684 |
| Quick ratio | 0.39 | 0.21 | 0.09 | 0.34 | 0.24 |
December 31, 2024 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($53,197K
+ $—K
+ $—K)
÷ $137,926K
= 0.39
The quick ratio of LGI Homes has displayed varying trends over the past five years. In December 2020, the quick ratio was 0.24, indicating that the company may have had difficulty meeting its short-term obligations with its most liquid assets. By December 2021, the quick ratio improved to 0.34, suggesting a better ability to cover current liabilities with liquid assets.
However, the quick ratio decreased significantly to 0.09 by December 2022, raising concerns about LGI Homes' short-term liquidity position. This decline may signal potential difficulties in meeting immediate financial obligations without relying on the sale of inventory or other less liquid assets.
Subsequently, by December 2023, the quick ratio slightly recovered to 0.21, albeit remaining low compared to earlier years. The improvement could indicate some efforts to strengthen liquidity, but the ratio still suggests a limited ability to cover short-term liabilities without additional measures.
Looking at December 2024, the quick ratio increased to 0.39, signaling a notable enhancement in LGI Homes' ability to meet short-term obligations with its quick assets. This positive trend may indicate improved liquidity management or better control over current liabilities compared to the prior years.
Overall, LGI Homes' quick ratio fluctuated over the analyzed period, reflecting varying levels of liquidity and the company's ability to cover short-term obligations. Continuous monitoring and management of liquidity are essential for maintaining financial stability and meeting obligations efficiently.
Peer comparison
Dec 31, 2024