Liquidity Services Inc (LQDT)

Cash ratio

		Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020	Sep 30, 2019
Cash and cash equivalents	US$ in thousands	110,281	96,122	106,335	76,036	36,497
Short-term investments	US$ in thousands	7,891	1,819	0	0	30,000
Total current liabilities	US$ in thousands	120,718	123,503	109,173	74,324	68,822
Cash ratio		0.98	0.79	0.97	1.02	0.97

September 30, 2023 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($110,281K + $7,891K) ÷ $120,718K
= 0.98

The cash ratio of Liquidity Services Inc has fluctuated over the past five years. In 2023, the cash ratio stands at 1.05, indicating that the company has $1.05 in cash and near cash assets for every dollar of current liabilities. This represents an improvement from the previous year's ratio of 0.86 but is still lower than the ratios recorded in 2021, 2020, and 2019, which were 1.04, 1.13, and 1.12, respectively.

The trend in the cash ratio suggests that the company had a relatively lower liquidity position in 2022 but has since increased its ability to cover short-term obligations with its available cash and near cash assets. However, it is important to note that although the recent ratio has improved, it is still below the levels seen in previous years. This indicates a potential need for further analysis to understand the reasons behind the fluctuations and to assess the company's ability to meet its short-term financial obligations.