Power Integrations Inc (POWI)

Cash ratio

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Cash and cash equivalents	US$ in thousands	63,929	94,743	84,096	94,189	105,372	133,474	67,383	170,624	158,117	262,435	297,481	343,272	258,874	232,014	251,325	190,459	178,690	80,162	99,491	125,795
Short-term investments	US$ in thousands	247,640	261,896	262,219	264,439	248,441	229,754	260,209	273,419	372,235	286,506	217,777	148,067	190,318	211,926	194,556	232,183	232,398	164,649	130,275	92,901
Total current liabilities	US$ in thousands	48,867	53,421	64,819	63,062	58,376	58,859	70,129	69,234	72,321	66,062	68,266	62,527	62,526	66,251	64,755	54,470	50,476	49,652	55,334	50,921
Cash ratio		6.38	6.68	5.34	5.69	6.06	6.17	4.67	6.41	7.33	8.31	7.55	7.86	7.18	6.70	6.89	7.76	8.14	4.93	4.15	4.29

December 31, 2023 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($63,929K + $247,640K) ÷ $48,867K
= 6.38

The cash ratio of Power Integrations Inc. has exhibited fluctuations over the past eight quarters, with values ranging from 4.87 to 7.06. In the most recent quarter, Q4 2023, the cash ratio stood at 6.83, indicating that the company had $6.83 in cash and cash equivalents for every $1 of current liabilities. This level of liquidity suggests that Power Integrations Inc. has a strong ability to cover its short-term obligations with its available cash resources.

The trend of the cash ratio over the past quarters shows some variability, with occasional fluctuations in the company's liquidity position. However, overall, the cash ratio has remained relatively high, indicating that Power Integrations Inc. has maintained a healthy cash balance in relation to its current liabilities.

It is important to note that while a high cash ratio reflects good liquidity, excessively high levels of cash may also indicate an inefficient use of resources. Therefore, Power Integrations Inc. should continue to monitor and manage its cash position effectively to strike a balance between liquidity and optimal resource allocation.