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.