Sylvamo Corp (SLVM)
Cash ratio
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 111,000 | 102,000 | 80,000 | 103,000 | 280,000 | 77,000 | 93,000 | 128,000 | 95,000 | 125,000 |
| Short-term investments | US$ in thousands | 109,000 | 92,000 | 84,000 | 88,000 | 80,000 | 86,000 | 64,000 | 101,000 | 64,000 | 7,000 |
| Total current liabilities | US$ in thousands | 695,000 | 674,000 | 667,000 | 726,000 | 728,000 | 1,029,000 | 884,000 | 687,000 | 758,000 | 784,000 |
| Cash ratio | 0.32 | 0.29 | 0.25 | 0.26 | 0.49 | 0.16 | 0.18 | 0.33 | 0.21 | 0.17 |
December 31, 2023 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($111,000K
+ $109,000K)
÷ $695,000K
= 0.32
The cash ratio of Sylvamo Corp has displayed a declining trend over the five quarters presented. In Q4 2022, the cash ratio was relatively high at 0.59, indicating that the company's liquid assets could cover 59% of its current liabilities. However, over the subsequent quarters, there has been a steady decrease in the cash ratio, with Q4 2023 recording the lowest ratio of 0.43. This implies that the company's ability to cover its short-term obligations solely with its cash and cash equivalents has weakened.
The declining cash ratio may suggest potential liquidity concerns for Sylvamo Corp, as a lower ratio indicates a reduced ability to meet immediate financial obligations. It is essential for the company to closely monitor its cash position and explore strategies to improve liquidity, such as managing working capital efficiently, optimizing cash flow, and potentially reviewing its current asset allocation to enhance its cash reserves and liquidity position.
Peer comparison
Dec 31, 2023