Otter Tail Corporation (OTTR)
Cash ratio
Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
---|---|---|---|---|---|---|
Cash and cash equivalents | US$ in thousands | 230,373 | 118,996 | 1,537 | 1,163 | 21,199 |
Short-term investments | US$ in thousands | 7,771 | 5,503 | 5,432 | 1,662 | 1,586 |
Total current liabilities | US$ in thousands | 309,757 | 237,636 | 387,699 | 436,786 | 189,741 |
Cash ratio | 0.77 | 0.52 | 0.02 | 0.01 | 0.12 |
December 31, 2023 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($230,373K
+ $7,771K)
÷ $309,757K
= 0.77
The cash ratio of Otter Tail Corporation has exhibited significant fluctuations over the past five years. In 2023, the company's cash ratio improved to 0.85, indicating that it had $0.85 of cash and cash equivalents for every $1 of current liabilities. This represents a healthy increase from the previous year's ratio of 0.68.
The substantial improvement in the cash ratio from 2022 to 2023 suggests that Otter Tail Corporation has enhanced its liquidity position, potentially by increasing its cash reserves or reducing its short-term obligations.
Comparing the current ratio to earlier years, we observe a remarkable increase from 0.07 in 2020 to 0.85 in 2023, signifying a significant enhancement in the company's ability to cover its short-term obligations with available cash.
It is essential for investors and stakeholders to monitor Otter Tail Corporation's cash ratio closely as it reflects the company's ability to meet its immediate financial obligations using its cash and cash equivalents. The company's increasing cash ratio over the years indicates a positive trend in its liquidity management.
Peer comparison
Dec 31, 2023