Simulations Plus Inc (SLP)

Cash ratio

		Feb 29, 2024	Nov 30, 2023	Aug 31, 2023	May 31, 2023	Feb 28, 2023	Nov 30, 2022	Aug 31, 2022	May 31, 2022	Feb 28, 2022	Nov 30, 2021	Aug 31, 2021	May 31, 2021	Feb 28, 2021	Nov 30, 2020	Aug 31, 2020	May 31, 2020	Feb 29, 2020	Nov 30, 2019	Aug 31, 2019	May 31, 2019
Cash and cash equivalents	US$ in thousands	37,031	39,789	57,523	55,131	39,292	49,392	51,567	42,353	60,373	41,680	36,984	58,811	42,385	27,651	49,207	7,354	12,249	12,610	11,434	10,308
Short-term investments	US$ in thousands	71,473	74,101	57,940	67,234	76,052	82,139	76,668	79,801	64,192	82,660	86,620	60,948	75,367	91,115	66,804	0	—	0	0	—
Total current liabilities	US$ in thousands	14,528	8,588	11,987	9,022	6,002	8,039	7,735	5,915	9,004	9,615	11,574	7,340	6,541	5,477	5,506	7,785	5,481	5,633	4,783	5,074
Cash ratio		7.47	13.26	9.63	13.56	19.22	16.36	16.58	20.65	13.83	12.93	10.68	16.32	18.00	21.68	21.07	0.94	2.23	2.24	2.39	2.03

February 29, 2024 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($37,031K + $71,473K) ÷ $14,528K
= 7.47

The cash ratio of Simulations Plus Inc has shown fluctuations over the past few years. As of Feb 29, 2024, the company's cash ratio stands at 7.47, indicating that for every dollar of current liabilities, the company has $7.47 in cash and cash equivalents available to cover those obligations.

The trend in the cash ratio shows variability, with the ratio ranging from as low as 0.94 on May 31, 2020, to as high as 21.68 on Feb 28, 2021. Generally, a higher cash ratio is seen as favorable as it suggests the company has a stronger ability to meet its short-term obligations using cash on hand.

The recent decrease in the cash ratio from 16.58 on Aug 31, 2023, to 7.47 on Feb 29, 2024, may raise concerns about the company's liquidity position and its ability to meet short-term liabilities. It would be important for stakeholders to monitor this ratio closely in the future to ensure the company maintains a healthy level of cash reserves relative to its current liabilities.