Simply Good Foods Co (SMPL)

Cash ratio

		Aug 31, 2024	Aug 26, 2023	Aug 27, 2022	Aug 28, 2021	Aug 29, 2020
Cash and cash equivalents	US$ in thousands	132,530	87,715	67,494	75,345	95,847
Short-term investments	US$ in thousands	—	—	—	—	3,644
Total current liabilities	US$ in thousands	108,615	89,857	102,248	113,664	71,478
Cash ratio		1.22	0.98	0.66	0.66	1.39

August 31, 2024 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($132,530K + $—K) ÷ $108,615K
= 1.22

The cash ratio of Simply Good Foods Co has fluctuated over the past five years. As of August 31, 2024, the cash ratio stands at 1.22, showing an improvement compared to the previous year's ratio of 0.98. This indicates that the company's ability to cover its short-term liabilities with its cash and cash equivalents has strengthened.

Looking back at the trend over the five-year period, the cash ratio was at its lowest in August 27, 2022 and August 28, 2021, both at 0.66. This suggests a lower level of liquidity during those years compared to the rest of the period.

The highest cash ratio was observed on August 29, 2020, at 1.39, signifying the highest ability to cover short-term obligations with cash on hand during the period under review.

Overall, the company's cash ratio has shown variability, but the latest ratio of 1.22 indicates a relatively stronger liquidity position as of the most recent reporting period. Continued monitoring of the cash ratio will be important to assess the company's ongoing liquidity and ability to meet its short-term payment obligations.