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