Powell Industries Inc (POWL)
Cash ratio
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 245,875 | 101,954 | 114,314 | 160,216 | 118,639 |
| Short-term investments | US$ in thousands | 33,134 | 14,554 | 19,667 | 18,705 | 6,042 |
| Total current liabilities | US$ in thousands | 395,686 | 186,373 | 121,156 | 152,947 | 157,896 |
| Cash ratio | 0.71 | 0.63 | 1.11 | 1.17 | 0.79 |
September 30, 2023 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($245,875K
+ $33,134K)
÷ $395,686K
= 0.71
The cash ratio of Powell Industries, Inc. has shown a downward trend over the past five years. The cash ratio, which measures the company's ability to cover its short-term liabilities with its cash and cash equivalents, decreased to 0.89 in 2023 from 1.14 in 2022. This decline suggests a potential weakening of the company's short-term liquidity position. A decreasing cash ratio may indicate that Powell Industries has less cash available to cover its current obligations, which could raise concerns about its ability to meet short-term financial commitments. It may be beneficial for stakeholders to further investigate the factors contributing to this trend and assess the company's overall liquidity management.
Peer comparison
Sep 30, 2023