Simulations Plus Inc (SLP)

Quick ratio

		Aug 31, 2024	May 31, 2024	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
Cash	US$ in thousands	10,311	109,092	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
Short-term investments	US$ in thousands	9,944	9,875	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
Receivables	US$ in thousands	9,136	10,144	13,114	10,346	10,201	10,214	11,398	11,699	13,787	18,587	15,039	11,823	9,851	12,962	11,306	7,331	7,422	10,853	7,244	6,353
Total current liabilities	US$ in thousands	12,069	11,320	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
Quick ratio		2.44	11.41	8.37	14.47	10.48	14.70	21.12	17.82	18.36	23.79	15.50	14.16	11.53	18.08	19.73	23.02	22.42	2.34	3.56	3.37

August 31, 2024 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($10,311K + $9,944K + $9,136K) ÷ $12,069K
= 2.44

The quick ratio of Simulations Plus Inc has shown fluctuations over the past several quarters, ranging from a low of 2.34 to a high of 23.79. The quick ratio measures the company's ability to meet its short-term obligations with its most liquid assets. A quick ratio above 1 indicates that the company has enough liquid assets to cover its short-term liabilities.

In recent quarters, the quick ratio has generally been well above 1, indicating a strong ability to meet short-term obligations. The quick ratio soared to 23.79 in May 31, 2022, reflecting a substantial increase in liquid assets compared to short-term liabilities. However, this ratio dropped to 2.34 in Aug 31, 2020, which might indicate a temporary shortage of liquid assets relative to short-term liabilities.

Overall, a higher quick ratio is generally preferable as it indicates a stronger liquidity position. It's important to monitor the trend of the quick ratio over time to assess the company's ability to meet its short-term financial obligations effectively.