Mativ Holdings Inc. (MATV)
Cash ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 120,200 | 101,100 | 74,700 | 54,700 | 103,000 |
| Short-term investments | US$ in thousands | — | 23,300 | — | 59,000 | — |
| Total current liabilities | US$ in thousands | 281,400 | 466,200 | 231,100 | 166,900 | 157,600 |
| Cash ratio | 0.43 | 0.27 | 0.32 | 0.68 | 0.65 |
December 31, 2023 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($120,200K
+ $—K)
÷ $281,400K
= 0.43
The cash ratio of Mativ Holdings Inc has shown fluctuating trends over the past five years. In 2023, the cash ratio improved to 0.54 compared to the previous year's 0.33, indicating a stronger liquidity position as more cash is available to cover current liabilities. However, the cash ratio in 2023 is still lower than the levels observed in 2019 and 2021.
The cash ratio measures the company's ability to cover its short-term liabilities with its cash and cash equivalents. A higher cash ratio implies a stronger ability to meet current obligations without relying on external sources of funding.
It is important for Mativ Holdings Inc to maintain an optimal level of cash reserves to navigate through uncertainties or unforeseen events, as excessive reliance on external financing may lead to increased financial risk. Management should continue to monitor and manage the company's cash position effectively to ensure appropriate liquidity levels for sustainable operations.
Peer comparison
Dec 31, 2023