SolarEdge Technologies Inc (SEDG)

Cash ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cash and cash equivalents	US$ in thousands	338,468	783,112	530,089	827,146	223,901
Short-term investments	US$ in thousands	521,570	241,117	167,728	143,687	91,845
Total current liabilities	US$ in thousands	893,231	889,717	525,181	436,099	436,714
Cash ratio		0.96	1.15	1.33	2.23	0.72

December 31, 2023 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($338,468K + $521,570K) ÷ $893,231K
= 0.96

The cash ratio of Solaredge Technologies Inc has shown some fluctuations over the past five years. The ratio represents the company's ability to cover its short-term liabilities with its cash and cash equivalents.

In 2023, the cash ratio was 1.21, indicating that the company had $1.21 in cash and cash equivalents for every $1 of current liabilities. This ratio decreased compared to the previous year, suggesting a slight weakening of Solaredge's liquidity position.

In 2022, the cash ratio was 1.26, which was higher than in 2023 but lower than in 2021. This indicates that the company had slightly more cash on hand relative to its short-term obligations compared to the current year.

In 2021, the cash ratio was 1.53, showing a significant improvement in liquidity compared to the previous year. This means that Solaredge had $1.53 in cash and cash equivalents for every $1 of current liabilities, reflecting a strong ability to meet its short-term financial commitments.

In 2020, the cash ratio was 2.54, the highest among the five years analyzed. This suggests that Solaredge had a robust cash position relative to its short-term obligations, indicating a strong liquidity position in that year.

In 2019, the cash ratio was 0.81, the lowest in the period under review. This may indicate a relative liquidity strain for Solaredge in that year, as its cash and cash equivalents were only sufficient to cover a portion of its short-term liabilities.

Overall, while the cash ratio has fluctuated over the years, Solaredge Technologies Inc has generally maintained a reasonable level of liquidity, with some years showing stronger cash positions compared to others. It is important for investors and analysts to monitor these ratios to assess the company's ability to meet its short-term financial obligations.