Reliance Steel & Aluminum Co (RS)
Cash ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 1,080,200 | 1,173,400 | 300,500 | 683,500 | 174,300 |
| Short-term investments | US$ in thousands | — | — | — | — | — |
| Total current liabilities | US$ in thousands | 843,600 | 1,375,300 | 1,065,000 | 613,000 | 675,300 |
| Cash ratio | 1.28 | 0.85 | 0.28 | 1.12 | 0.26 |
December 31, 2023 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($1,080,200K
+ $—K)
÷ $843,600K
= 1.28
The cash ratio of Reliance Steel & Aluminum Co. has fluctuated over the past five years, ranging from 0.38 to 1.45. The trend indicates an improvement in liquidity from 2019 to 2023, with the ratio increasing from 0.38 to 1.45. This suggests that the company has been able to enhance its ability to cover its current liabilities with its cash and cash equivalents.
In particular, the cash ratio reached a peak of 1.45 at the end of 2023, indicating that the company had $1.45 in cash and cash equivalents for every dollar of current liabilities. This implies a strong liquidity position as the company had more than enough cash on hand to meet its short-term obligations.
Overall, the increasing trend in the cash ratio of Reliance Steel & Aluminum Co. reflects a positive liquidity position that has strengthened over the past five years, highlighting the company's ability to manage its short-term liquidity needs effectively.