Sensient Technologies Corporation (SXT)

Cash ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cash and cash equivalents	US$ in thousands	28,934	20,921	25,740	24,770	21,153
Short-term investments	US$ in thousands	—	—	—	—	—
Total current liabilities	US$ in thousands	236,306	272,153	232,305	215,955	201,375
Cash ratio		0.12	0.08	0.11	0.11	0.11

December 31, 2023 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($28,934K + $—K) ÷ $236,306K
= 0.12

The cash ratio of Sensient Technologies Corp. has fluctuated over the past five years, ranging from 0.25 to 0.34. The cash ratio measures the company's ability to cover its short-term liabilities with its cash and cash equivalents. A higher cash ratio indicates a stronger ability to meet short-term obligations.

In 2023, the cash ratio decreased to 0.28 from 0.25 in 2022, suggesting a slight improvement in the company's liquidity position. However, the ratio remains below the levels seen in 2020 and 2021. Sensient may need to ensure it maintains sufficient cash reserves to cover its short-term liabilities effectively, especially in times of economic uncertainty or unexpected expenses.

Overall, while the slight increase in the cash ratio from 2022 to 2023 is positive, the company should continue to monitor and manage its liquidity position to ensure financial stability and meet its short-term obligations effectively.