MACOM Technology Solutions Holdings Inc (MTSI)

Cash ratio

		Sep 30, 2024	Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020
Cash and cash equivalents	US$ in thousands	146,806	173,952	119,952	156,537	129,441
Short-term investments	US$ in thousands	435,082	340,574	466,580	188,365	203,711
Total current liabilities	US$ in thousands	108,184	83,525	97,214	93,044	94,950
Cash ratio		5.38	6.16	6.03	3.71	3.51

September 30, 2024 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($146,806K + $435,082K) ÷ $108,184K
= 5.38

The cash ratio of MACOM Technology Solutions Holdings Inc has shown a fluctuating trend over the past five years. In 2024, the cash ratio was 5.38, indicating that the company had $5.38 in cash and cash equivalents for every $1 of current liabilities. This was a decrease from the previous year's ratio of 6.16.

Despite the slight decrease in 2024, the company's cash ratio remains relatively high compared to 2020 and 2021, when the ratios were 3.71 and 3.51, respectively. This suggests that MACOM Technology Solutions Holdings Inc has maintained a strong ability to cover its short-term obligations with its available cash resources in recent years.

However, it is important to note that a very high cash ratio might also indicate that the company is holding excess cash that could potentially be invested more efficiently to generate returns. Therefore, while a high cash ratio can indicate financial stability and liquidity, it is essential for the company to strike a balance between holding adequate cash reserves and maximizing returns on its cash holdings.