Nucor Corp (NUE)

Cash ratio

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Cash and cash equivalents	US$ in thousands	6,383,300	5,855,950	4,510,560	3,800,030	4,280,850	3,049,860	2,002,710	3,725,270	2,364,860	1,764,290	2,722,660	2,460,720	2,639,670	2,866,580	2,789,190	1,245,160	1,534,600	1,686,360	1,431,790	1,550,810
Short-term investments	US$ in thousands	747,479	863,140	870,475	817,811	576,946	377,426	363,287	446,868	253,005	247,247	398,409	402,595	408,004	412,401	247,473	146,000	300,040	249,616	50,000	50,000
Total current liabilities	US$ in thousands	4,594,510	4,283,850	4,004,170	3,829,940	4,329,740	4,632,090	5,359,200	5,133,840	5,157,410	4,797,600	3,879,950	2,970,450	2,627,860	2,373,300	1,965,040	2,218,570	2,463,770	2,585,990	2,380,410	2,568,020
Cash ratio		1.55	1.57	1.34	1.21	1.12	0.74	0.44	0.81	0.51	0.42	0.80	0.96	1.16	1.38	1.55	0.63	0.74	0.75	0.62	0.62

December 31, 2023 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($6,383,300K + $747,479K) ÷ $4,594,510K
= 1.55

The cash ratio measures a company's ability to cover its short-term liabilities using its available cash and cash equivalents. A higher cash ratio indicates a stronger ability to cover these obligations.

Analyzing the cash ratio of Nucor Corp. over the past eight quarters, we observe a general increasing trend during the period. In Q1 2022, the cash ratio was 0.86, indicating the company had lower liquidity to cover short-term obligations. However, there was a significant improvement in subsequent quarters, with the ratio reaching 1.71 in Q4 2023, demonstrating a substantial increase in liquidity.

This upward trend suggests that Nucor Corp. has been effectively managing its cash and cash equivalents, resulting in a stronger ability to meet its short-term liabilities. The company's consistent improvement in the cash ratio indicates a positive liquidity position and may reflect prudent financial management practices. However, it is important to note that a very high cash ratio may also indicate that the company is not efficiently utilizing its cash to generate returns.