RadNet Inc (RDNT)

Cash ratio

Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Cash and cash equivalents US$ in thousands 740,020 342,570 127,834 134,606 102,018
Short-term investments US$ in thousands — — — — 34,528
Total current liabilities US$ in thousands 479,712 437,452 466,723 374,784 398,114
Cash ratio 1.54 0.78 0.27 0.36 0.34

December 31, 2024 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($740,020K + $—K) ÷ $479,712K
= 1.54

The cash ratio is a liquidity ratio that measures a company's ability to cover its short-term obligations using its cash and cash equivalents. Looking at the data provided for RadNet Inc, we observe fluctuations in the cash ratio over the years.

As of December 31, 2020, the cash ratio was 0.34, indicating that the company had $0.34 in cash and cash equivalents for every dollar of current liabilities. Over the next few years, the ratio increased steadily to 0.36 by December 31, 2021, and then dropped to 0.27 by December 31, 2022. This decline could signify potential challenges in meeting short-term obligations with available cash.

However, the trend reversed dramatically in the following years, with the cash ratio surging to 0.78 on December 31, 2023, and significantly improving to 1.54 by December 31, 2024. These higher ratios suggest that RadNet Inc strengthened its liquidity position, having more than enough cash to cover immediate liabilities.

Overall, the data indicates varying levels of liquidity for RadNet Inc over the years, with improvements in recent years potentially reflecting better cash management practices or increased cash reserves. It is essential for the company to maintain a healthy cash ratio to ensure its ability to meet short-term obligations efficiently.