NVR Inc (NVR)

Current ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Total current assets	US$ in thousands	5,194,590	4,700,190	4,904,830	2,809,780	1,160,800
Total current liabilities	US$ in thousands	1,222,730	832,646	823,814	843,258	653,007
Current ratio		4.25	5.64	5.95	3.33	1.78

December 31, 2023 calculation

Current ratio = Total current assets ÷ Total current liabilities
= $5,194,590K ÷ $1,222,730K
= 4.25

The current ratio of NVR Inc. has fluctuated over the past five years, ranging from 1.74 to 4.16. A current ratio of 4.16 as of December 31, 2023, indicates that the company had $4.16 in current assets for every $1 of current liabilities. This represents a significant improvement compared to the previous years, where the current ratio ranged from 1.74 to 2.20.

A current ratio above 1 suggests that NVR Inc. has more than enough current assets to cover its current liabilities, signaling good liquidity and short-term financial health. A higher current ratio indicates a stronger ability to settle short-term obligations and suggests that the company may be better positioned to withstand unexpected financial challenges or capitalize on opportunities.

The upward trend in the current ratio from 2021 to 2023 reflects improved liquidity and potentially more efficient management of current assets and liabilities. However, it is essential to further investigate the components of current assets and liabilities to gain a deeper understanding of the company's liquidity position and operating efficiency.

Overall, the current ratio of NVR Inc. has shown positive trends over the past few years, indicating improved short-term financial stability and stronger liquidity position.