Novanta Inc (NOVT)
Quick ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 113,989 | 105,051 | 100,105 | 117,393 | 125,054 |
| Short-term investments | US$ in thousands | — | — | — | — | — |
| Receivables | US$ in thousands | 151,026 | 139,410 | 137,697 | 115,617 | 75,054 |
| Total current liabilities | US$ in thousands | 167,791 | 139,175 | 164,522 | 183,938 | 114,229 |
| Quick ratio | 1.58 | 1.76 | 1.45 | 1.27 | 1.75 |
December 31, 2024 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($113,989K
+ $—K
+ $151,026K)
÷ $167,791K
= 1.58
The quick ratio measures Novanta Inc's ability to meet its short-term obligations using its most liquid assets. Over the past five years, the company's quick ratio has shown some fluctuations. In December 2020, the quick ratio stood at a healthy 1.75, indicating the company had $1.75 in quick assets to cover each dollar of current liabilities.
However, by December 2021, the quick ratio had decreased to 1.27, suggesting a slight decline in the company's ability to meet short-term obligations with liquid assets. This could potentially raise concerns about liquidity management during that period.
In the subsequent years, the quick ratio improved, reaching 1.45 in December 2022, 1.76 in December 2023, and then decreasing slightly to 1.58 by December 2024. Overall, the quick ratio of Novanta Inc has generally remained above 1 during the period, indicating that the company has had an adequate level of liquid assets to cover its short-term liabilities. However, it is important to monitor this ratio to ensure that the company maintains liquidity and can meet its obligations as they come due.
Peer comparison
Dec 31, 2024