TRI Pointe Homes Inc (TPH)

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	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Cash and cash equivalents	US$ in thousands	868,953	849,039	981,567	966,298	889,664	228,137	270,124	412,703	681,528	587,405	556,483	584,665	621,295	493,585	474,545	624,129	329,011	130,262	171,516	148,782
Short-term investments	US$ in thousands	—	—	—	—	129,837	132,998	131,399	122,366	118,095	—	—	—	—	—	—	—	—	—	—	—
Total current liabilities	US$ in thousands	43,991	48,977	46,713	43,439	42,027	71,569	77,732	73,547	55,156	62,912	61,096	55,741	43,602	39,288	30,411	28,534	20,876	316,528	284,036	163,032
Cash ratio		19.75	17.34	21.01	22.24	24.26	5.05	5.17	7.28	14.50	9.34	9.11	10.49	14.25	12.56	15.60	21.87	15.76	0.41	0.60	0.91

December 31, 2023 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($868,953K + $—K) ÷ $43,991K
= 19.75

The cash ratio of Tri Pointe Homes Inc. has shown a fluctuating trend over the past eight quarters, ranging from a low of 0.56 in Q3 2022 to a high of 2.41 in Q2 2023. The cash ratio measures the ability of a company to cover its current liabilities with its available cash and cash equivalents.

In the most recent quarter, Q4 2023, the cash ratio increased to 2.07, indicating that Tri Pointe Homes Inc. had more than double the amount of cash and cash equivalents compared to its current liabilities. This suggests a strong liquidity position and the ability to meet its short-term obligations without relying on external financing.

It's worth noting that the cash ratio was consistently below 1 in the first two quarters of 2022, indicating a potential liquidity challenge during that period. However, the company improved its liquidity position significantly in the subsequent quarters.

Overall, the upward trend in the cash ratio in recent quarters is a positive indication of Tri Pointe Homes Inc.'s improved liquidity and ability to manage its short-term obligations with its cash reserves. Investors and stakeholders may view this as a favorable sign of financial health and stability.