Sonic Automotive Inc (SAH)

Quick 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	US$ in thousands	28,900	34,600	119,700	160,200	229,200	139,000	327	360	299,400	220,100	239,600	77,200	170,300	125,739	115,724	181,780	29,100	2,401	2,140	2,722
Short-term investments	US$ in thousands	—	300,000	287,000	272,000	272,000	32,000	125,500	—	—	—	17	33	13	—	—	—	3	104,868	95,046	82,044
Receivables	US$ in thousands	528,100	431,500	400,600	374,800	462,400	360,600	345,900	351,500	401,100	278,008	356,850	373,518	371,700	286,938	322,703	200,876	432,742	365,005	364,026	371,768
Total current liabilities	US$ in thousands	2,292,900	2,009,200	2,004,400	2,057,000	1,845,400	1,718,500	1,883,100	1,869,200	1,891,700	1,428,400	1,635,800	1,781,330	1,831,400	1,629,020	1,748,180	2,013,040	2,066,160	1,945,950	1,965,410	1,966,280
Quick ratio		0.24	0.38	0.40	0.39	0.52	0.31	0.25	0.19	0.37	0.35	0.36	0.25	0.30	0.25	0.25	0.19	0.22	0.24	0.23	0.23

December 31, 2023 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($28,900K + $—K + $528,100K) ÷ $2,292,900K
= 0.24

The quick ratio of Sonic Automotive, Inc. has shown some fluctuation over the past eight quarters. The quick ratio measures the company's ability to meet its short-term obligations with its most liquid assets. A quick ratio below 1 indicates that the company may have difficulty meeting its short-term liabilities.

From Q4 2022 to Q2 2023, the quick ratio ranged from 0.33 to 0.46, displaying some volatility during this period. Notably, the quick ratio decreased to 0.33 in Q3 2022, indicating a potential liquidity strain. However, the ratio improved in subsequent quarters, reaching its peak at 0.54 in Q4 2022.

In the recent quarters of Q3 and Q4 2023, the quick ratio ranged between 0.40 and 0.42, which suggests that Sonic Automotive may have some challenges in covering its short-term obligations with its current liquid assets.

Overall, the trend in Sonic Automotive's quick ratio indicates some variability in its ability to meet short-term obligations, which management should monitor closely to ensure financial stability and liquidity management.