Dave & Buster’s Entertainment (PLAY)

Cash ratio

		Feb 4, 2024	Jan 29, 2023	Jan 30, 2022	Jan 31, 2021	Feb 2, 2020
Cash and cash equivalents	US$ in thousands	37,300	181,600	25,910	11,891	24,655
Short-term investments	US$ in thousands	—	—	—	—	—
Total current liabilities	US$ in thousands	435,600	438,000	311,515	271,636	290,865
Cash ratio		0.09	0.41	0.08	0.04	0.08

February 4, 2024 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($37,300K + $—K) ÷ $435,600K
= 0.09

The cash ratio of Dave & Buster's Entertainment has fluctuated over the past five years, indicating varying levels of liquidity. In the most recent fiscal year, as of February 4, 2024, the cash ratio stands at 0.09, which means that for every dollar of current liabilities, the company has $0.09 in cash or near-cash assets available to cover its short-term obligations. This ratio has significantly decreased compared to the previous year, signaling potential liquidity challenges or a shift in the company's cash management strategy.

On the other hand, the cash ratio was considerably higher in the fiscal year ending January 29, 2023, at 0.41, indicating a strong ability to cover short-term obligations with cash reserves. This could suggest effective cash management practices or a temporary accumulation of cash during that period.

Looking back further, the cash ratio was lower in the fiscal years 2022 and 2020, at 0.08 and 0.08 respectively, suggesting a consistent level of liquidity over those years. However, in the fiscal year ending January 31, 2021, the cash ratio was notably lower at 0.04, potentially indicating a tighter liquidity position or a higher proportion of current liabilities compared to available cash.

Overall, fluctuations in Dave & Buster's cash ratio over the years may reflect varying cash management strategies, changes in operating cash flows, or shifts in the company's financial position. It is essential for stakeholders to closely monitor the company's liquidity ratios to assess its ability to meet short-term obligations and manage cash effectively.