Select Medical Holdings (SEM)

Cash ratio

Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Cash and cash equivalents US$ in thousands 84,006 97,906 74,310 577,061 335,882
Short-term investments US$ in thousands 58,962 74,857
Total current liabilities US$ in thousands 1,248,460 1,155,150 1,273,080 1,438,370 914,280
Cash ratio 0.11 0.15 0.06 0.40 0.37

December 31, 2023 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($84,006K + $58,962K) ÷ $1,248,460K
= 0.11

The cash ratio of Select Medical Holdings Corporation has exhibited fluctuations over the past five years. The ratio stood at 0.25 as of December 31, 2023, down from 0.29 in the previous year and 0.20 in 2021. It is noteworthy that the cash ratio was significantly higher in 2020 at 0.48 and 0.49 in 2019.

The cash ratio measures a company's ability to cover its short-term obligations using its most liquid assets, namely cash and cash equivalents. A higher cash ratio indicates that a company has a stronger ability to meet its short-term obligations.

The decreasing trend in Select Medical Holdings Corporation's cash ratio over the past three years may signal a decrease in its liquidity position or potentially a shift in its cash management strategy. Further analysis and comparison with industry peers would be beneficial in understanding the company's liquidity position and financial health. It is advisable for investors and stakeholders to closely monitor the cash ratio trend to assess the company's ability to meet its short-term obligations effectively.


Peer comparison

Dec 31, 2023

Company name
Symbol
Cash ratio
Select Medical Holdings
SEM
0.11
Encompass Health Corp
EHC
0.16
Mednax Inc
MD
0.46