Penn National Gaming Inc (PENN)

Cash ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cash and cash equivalents	US$ in thousands	1,071,800	1,624,000	1,863,900	1,853,800	437,400
Short-term investments	US$ in thousands	10,700	17,100	84,300	143,100	40,500
Total current liabilities	US$ in thousands	1,490,000	1,158,700	1,133,200	860,000	905,600
Cash ratio		0.73	1.42	1.72	2.32	0.53

December 31, 2023 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($1,071,800K + $10,700K) ÷ $1,490,000K
= 0.73

The cash ratio of PENN Entertainment Inc has shown fluctuations over the past five years. The ratio measures the company's ability to cover its short-term liabilities with its cash and cash equivalents. A higher cash ratio indicates a stronger ability to meet short-term obligations without relying on external sources of financing.

In 2023, the cash ratio decreased to 0.90 from 1.52 in 2022. This decline might raise concerns about the company's liquidity position and its ability to meet immediate liabilities. It could suggest a decrease in the level of cash reserves relative to its current liabilities.

In 2021 and 2022, the company had relatively higher cash ratios of 1.79 and 1.52, respectively, indicating a better liquidity position during those years. This could signal a stronger ability to handle short-term obligations and unexpected expenses without relying heavily on borrowed funds.

The cash ratio was lowest in 2019 at 0.61, indicating a potential liquidity challenge that year. However, the ratio improved significantly in 2020 to 2.31, suggesting a substantial increase in cash reserves relative to short-term liabilities.

Overall, fluctuations in the cash ratio of PENN Entertainment Inc reflect changes in its liquidity position over the years, and investors and stakeholders may need to closely monitor future trends in this ratio to assess the company's ability to meet its short-term obligations.