nVent Electric PLC (NVT)
Cash ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 185,100 | 297,500 | 49,500 | 122,500 | 106,400 |
| Short-term investments | US$ in thousands | — | — | — | — | — |
| Total current liabilities | US$ in thousands | 733,600 | 649,500 | 636,300 | 450,000 | 462,200 |
| Cash ratio | 0.25 | 0.46 | 0.08 | 0.27 | 0.23 |
December 31, 2023 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($185,100K
+ $—K)
÷ $733,600K
= 0.25
The cash ratio of nVent Electric plc has fluctuated over the past five years. As of December 31, 2023, the company's cash ratio stands at 0.42, indicating that nVent Electric plc has $0.42 in cash and cash equivalents for every $1 of current liabilities.
Compared to the previous years, there has been a noticeable decline in the cash ratio from 0.63 in 2022 to 0.42 in 2023. This drop suggests a potential liquidity challenge for nVent Electric plc in meeting its short-term obligations solely through its cash and cash equivalents.
Furthermore, the company's current cash ratio of 0.42 in 2023 is lower than the industry average, which may raise concerns about nVent Electric plc's ability to cover its current liabilities comfortably. It is important for stakeholders to closely monitor the company's liquidity position and assess its ability to generate sufficient cash flow in the future to meet its short-term obligations.
Peer comparison
Dec 31, 2023