Sensata Technologies Holding NV (ST)

Cash ratio

Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Cash and cash equivalents US$ in thousands 593,670 508,104 1,225,520 1,708,960 1,861,980
Short-term investments US$ in thousands -0
Total current liabilities US$ in thousands 711,358 823,718 1,178,970 836,259 745,157
Cash ratio 0.83 0.62 1.04 2.04 2.50

December 31, 2024 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($593,670K + $—K) ÷ $711,358K
= 0.83

The cash ratio measures a company's ability to cover its short-term liabilities with its cash and cash equivalents. Sensata Technologies Holding NV's cash ratio has decreased from 2.50 in December 2020 to 0.83 in December 2024.

A higher cash ratio indicates a stronger ability to meet short-term obligations. The declining trend in Sensata's cash ratio suggests a potential decrease in its liquidity position over the years. This could be a cause for concern, as a lower cash ratio may signal difficulties in meeting immediate financial obligations without relying on external sources of funding.

It is important for Sensata to closely monitor its cash position and take necessary steps to improve liquidity in order to safeguard against potential liquidity challenges in the future.