Ligand Pharmaceuticals Incorporated (LGND)

Quick ratio

		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	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Cash	US$ in thousands	22,954	19,275	28,445	88,728	45,006	4,116	5,280	14,993	19,522	23,430	21,863	31,853	47,619	457	115,156	117,527	71,543	225,302	273,047	105,113
Short-term investments	US$ in thousands	147,355	171,227	190,596	193,937	166,864	117,291	142,655	189,006	321,586	299,781	279,972	307,354	363,567	338,154	694,724	621,284	998,324	874,383	1,059,000	1,323,580
Receivables	US$ in thousands	39,312	36,003	27,994	29,188	35,038	65,953	63,272	41,797	91,646	70,714	62,850	55,581	59,064	32,907	44,553	46,777	41,748	21,958	20,259	26,615
Total current liabilities	US$ in thousands	16,782	15,727	29,388	98,929	98,810	135,241	167,853	42,578	41,665	36,297	52,497	95,805	100,111	42,300	29,264	20,438	17,002	35,695	108,985	186,777
Quick ratio		12.49	14.40	8.41	3.15	2.50	1.39	1.26	5.77	10.39	10.85	6.95	4.12	4.70	8.78	29.20	38.44	65.38	31.42	12.41	7.79

December 31, 2023 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($22,954K + $147,355K + $39,312K) ÷ $16,782K
= 12.49

The quick ratio, also known as the acid-test ratio, measures a company's ability to meet its short-term obligations using its most liquid assets. A quick ratio above 1 indicates that the company has more than enough liquid assets to cover its current liabilities.

Analyzing the quick ratio of Ligand Pharmaceuticals, Inc. over the past eight quarters, we observe fluctuations in the ratio. In Q4 2023, the quick ratio was exceptionally high at 12.72, indicating a strong ability to cover short-term liabilities with liquid assets. This may suggest an efficient management of current assets to meet short-term obligations.

The quick ratio remained above 1 in all quarters, except in Q3 2022 where it dropped to 1.46. However, it rebounded quickly in subsequent quarters, reflecting the company's ability to maintain a healthy level of liquidity. Notably, in Q2 2023, the quick ratio dipped to 8.50, which may warrant further investigation into the composition of current assets and liabilities during that period.

Overall, the trend in Ligand Pharmaceuticals' quick ratio indicates a generally positive liquidity position, with fluctuations over time. Investors and stakeholders may consider additional qualitative factors to assess the company's overall financial health and ability to manage short-term obligations effectively.