Schrodinger Inc (SDGR)

Quick ratio

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Cash	US$ in thousands	147,326	155,315	90,474	120,267	202,296
Short-term investments	US$ in thousands	204,798	307,688	360,613	456,212	440,395
Receivables	US$ in thousands	—	—	—	—	—
Total current liabilities	US$ in thousands	191,747	133,673	108,799	91,211	73,205
Quick ratio		1.84	3.46	4.15	6.32	8.78

December 31, 2024 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($147,326K + $204,798K + $—K) ÷ $191,747K
= 1.84

The quick ratio, also known as the acid-test ratio, is a financial metric used to evaluate a company's short-term liquidity and ability to meet its immediate obligations without relying on the sale of inventory. Higher values of the quick ratio indicate a stronger liquidity position.

Reviewing the quick ratio trend of Schrodinger Inc from 2020 to 2024, we observe a gradual decline. In 2020, the quick ratio stood at a robust 8.78, indicating a strong ability to cover short-term liabilities with liquid assets. However, this ratio decreased to 6.32 in 2021, suggesting a slight reduction in liquidity.

Subsequently, the quick ratio continued to decrease to 4.15 in 2022 and further declined to 3.46 in 2023. These downward trends may raise concerns about Schrodinger Inc's ability to meet its short-term obligations without relying on inventory sales.

By the end of 2024, the quick ratio fell to 1.84, signaling a significant decrease from the initial value in 2020. This decline could potentially indicate liquidity challenges for the company in the near term.

In conclusion, the decreasing trend of Schrodinger Inc's quick ratio over the years highlights a potential weakening of the company's short-term liquidity position. Further analysis and monitoring of liquidity management practices may be necessary to address potential liquidity risks.