MGE Energy Inc (MGEE)
Cash ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 21,302 | 11,140 | 11,604 | 17,438 | 44,738 |
| Short-term investments | US$ in thousands | — | — | — | — | — |
| Total current liabilities | US$ in thousands | 125,563 | 157,156 | 225,062 | 117,847 | 190,926 |
| Cash ratio | 0.17 | 0.07 | 0.05 | 0.15 | 0.23 |
December 31, 2024 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($21,302K
+ $—K)
÷ $125,563K
= 0.17
The cash ratio measures a company's ability to cover its short-term liabilities with its available cash and cash equivalents. In the case of MGE Energy Inc, the cash ratio has fluctuated over the past five years.
As of December 31, 2020, the cash ratio stood at 0.23, indicating that the company had $0.23 in cash and cash equivalents for every $1 of current liabilities. However, by December 31, 2022, the cash ratio decreased to 0.05, suggesting a decline in the company's ability to meet short-term obligations solely with cash.
Despite the decrease in 2022, MGE Energy Inc's cash ratio improved to 0.17 by December 31, 2024. This indicates a recovery in the company's liquidity position, with a higher amount of cash available relative to its short-term liabilities, compared to the previous years.
Overall, MGE Energy Inc's cash ratio has exhibited some volatility in the recent years, with fluctuations reflecting changes in the company's liquidity position and ability to cover short-term obligations with available cash resources. Investors and stakeholders may want to monitor these trends to assess the company's financial health and liquidity management strategies.