Scholastic Corporation (SCHL)
Quick ratio
| May 31, 2024 | May 31, 2023 | May 31, 2022 | May 31, 2021 | May 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 113,700 | 224,500 | 316,600 | 366,500 | 393,800 |
| Short-term investments | US$ in thousands | — | — | — | — | — |
| Receivables | US$ in thousands | 250,200 | 286,900 | 326,200 | 344,900 | 329,800 |
| Total current liabilities | US$ in thousands | 534,700 | 602,300 | 619,700 | 695,500 | 501,500 |
| Quick ratio | 0.68 | 0.85 | 1.04 | 1.02 | 1.44 |
May 31, 2024 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($113,700K
+ $—K
+ $250,200K)
÷ $534,700K
= 0.68
The quick ratio of Scholastic Corporation has shown a declining trend over the past five years, indicating a potential deterioration in the company's short-term liquidity position. The quick ratio decreased from 1.44 in 2020 to 0.68 in 2024. This decline suggests that the company may have been facing challenges in meeting its short-term obligations with its most liquid assets in recent years.
A quick ratio below 1.0 generally raises concerns about a company's ability to cover its short-term debts with its current assets excluding inventory. Scholastic Corporation's quick ratio has fallen below this benchmark in the most recent year, indicating a potential liquidity strain.
It is important for investors and stakeholders to monitor Scholastic Corporation's liquidity position closely and assess the company's ability to generate sufficient cash flows or access external funding sources to meet its short-term obligations. Additionally, management may need to implement strategies to improve liquidity and strengthen the company's financial position.
Peer comparison
May 31, 2024