Insulet Corporation (PODD)
Cash ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 704,200 | 674,200 | 790,000 | 907,200 | 213,700 |
| Short-term investments | US$ in thousands | 53,500 | 50,800 | — | 40,400 | 162,400 |
| Total current liabilities | US$ in thousands | 451,200 | 364,700 | 228,800 | 207,800 | 157,700 |
| Cash ratio | 1.68 | 1.99 | 3.45 | 4.56 | 2.38 |
December 31, 2023 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($704,200K
+ $53,500K)
÷ $451,200K
= 1.68
Insulet Corporation's cash ratio has shown a decreasing trend over the past five years, declining from 2.58 in 2019 to 1.82 in 2023. The cash ratio measures a company's ability to cover its short-term liabilities using its cash and cash equivalents. A higher cash ratio indicates a stronger ability to meet short-term obligations.
In 2021, Insulet Corporation had a relatively high cash ratio of 3.78, reflecting a robust liquidity position that could comfortably cover its short-term liabilities. However, the ratio decreased significantly in subsequent years, possibly due to changes in the company's cash management or investment strategies.
The declining trend in the cash ratio raises potential concerns about Insulet Corporation's liquidity position and its ability to meet short-term obligations. Investors and analysts may monitor this trend closely to assess the company's financial health and liquidity management.
Peer comparison
Dec 31, 2023