Stepan Company (SCL)
Cash ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 129,823 | 173,750 | 159,186 | 349,938 | 315,383 |
| Short-term investments | US$ in thousands | — | — | — | 30,652 | — |
| Total current liabilities | US$ in thousands | 607,870 | 670,649 | 500,476 | 416,554 | 339,114 |
| Cash ratio | 0.21 | 0.26 | 0.32 | 0.91 | 0.93 |
December 31, 2023 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($129,823K
+ $—K)
÷ $607,870K
= 0.21
The cash ratio of Stepan Co. has decreased consistently over the past five years. The ratio stood at 0.27 as of December 31, 2023, compared to 0.31 in 2022, 0.38 in 2021, 0.93 in 2020, and 1.00 in 2019. This decline indicates a decreasing ability to cover its short-term liabilities solely with cash and cash equivalents. A lower cash ratio may suggest potential liquidity concerns and the need to manage cash more effectively to ensure the company can meet its immediate financial obligations. Further analysis of Stepan Co.'s cash management practices and overall financial health would be beneficial to fully assess its liquidity position.
Peer comparison
Dec 31, 2023