Papa John's International Inc (PZZA)

Current 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
Total current assets	US$ in thousands	231,018	246,556	242,002	246,898	251,039	239,524	239,788	286,269	255,009	271,760	262,343	331,581	306,407	279,938	225,473	185,193	181,546	194,384	193,885	199,414
Total current liabilities	US$ in thousands	304,596	301,339	296,793	272,930	265,157	263,727	250,477	278,634	287,424	318,119	316,504	291,723	288,869	260,491	228,919	215,651	207,945	221,889	211,320	218,569
Current ratio		0.76	0.82	0.82	0.90	0.95	0.91	0.96	1.03	0.89	0.85	0.83	1.14	1.06	1.07	0.98	0.86	0.87	0.88	0.92	0.91

December 31, 2023 calculation

Current ratio = Total current assets ÷ Total current liabilities
= $231,018K ÷ $304,596K
= 0.76

The current ratio measures a company's ability to meet its short-term obligations with its current assets. A higher current ratio generally indicates better liquidity and financial health. It is calculated by dividing current assets by current liabilities.

Based on the data provided, Papa John's International, Inc.'s current ratio has fluctuated over the past eight quarters. The current ratio was highest in Q1 2022 at 1.03 and lowest in Q4 2023 at 0.76. Generally, the current ratio decreased from 1.03 in Q1 2022 to 0.76 in Q4 2023, indicating a potential deterioration in the company's short-term liquidity position.

A current ratio below 1 may suggest that the company may have difficulty meeting its short-term obligations with its current assets alone. Investors and creditors may view a declining current ratio with concern, as it may indicate potential financial stress or inefficiencies in managing working capital.

It is important for Papa John's International, Inc. to closely monitor its current ratio and take necessary steps to improve liquidity, such as managing inventory levels, controlling accounts receivable, or adjusting current liabilities. Additionally, the company may need to ensure that its current assets are efficiently utilized to meet its short-term obligations and sustain its operations effectively.