SolarEdge Technologies Inc (SEDG)

Cash ratio

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Cash and cash equivalents	US$ in thousands	274,611	338,468	783,112	530,089	827,146
Short-term investments	US$ in thousands	311,279	521,570	241,117	167,728	143,687
Total current liabilities	US$ in thousands	1,041,080	893,231	889,717	525,181	436,099
Cash ratio		0.56	0.96	1.15	1.33	2.23

December 31, 2024 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($274,611K + $311,279K) ÷ $1,041,080K
= 0.56

The cash ratio of SolarEdge Technologies Inc has been steadily declining over the years, indicating a decrease in its ability to cover short-term obligations solely with its cash and cash equivalents.
At the end of December 31, 2020, the cash ratio was 2.23, reflecting a strong ability to meet short-term liabilities with cash on hand. However, by December 31, 2024, the cash ratio had decreased to 0.56, suggesting a significant decline in liquidity strength.
This downward trend in the cash ratio could raise concerns about the company's liquidity position and its ability to handle immediate financial obligations using available cash reserves. Monitoring this ratio closely is essential to assess SolarEdge's ability to manage short-term liabilities effectively.