Trex Company Inc (TREX)
Cash ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 1,959 | 12,325 | 141,053 | 121,701 | 148,833 |
| Short-term investments | US$ in thousands | — | — | — | — | — |
| Total current liabilities | US$ in thousands | 91,062 | 290,599 | 88,702 | 106,353 | 78,670 |
| Cash ratio | 0.02 | 0.04 | 1.59 | 1.14 | 1.89 |
December 31, 2023 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($1,959K
+ $—K)
÷ $91,062K
= 0.02
The cash ratio of TREX Co., Inc. has fluctuated over the past five years. In 2023, the cash ratio stood at 0.16, indicating that for every dollar of current liabilities, the company had $0.16 in cash and equivalents available to cover those obligations. This represents an improvement compared to 2022, where the cash ratio was 0.08.
However, when comparing the current cash ratio to earlier years, TREX Co., Inc. had higher levels of liquidity in 2021 with a cash ratio of 1.87, followed by 2020 with a ratio of 1.31 and 2019 with a ratio of 2.11. This suggests that the company had more cash readily available to settle its short-term obligations in those years.
The significant drop in the cash ratio from 2021 to 2022 and the subsequent improvement in 2023 may indicate fluctuations in the company's ability to generate or retain cash during these periods. Further analysis of the company's cash management practices, investment strategies, and operating efficiency would provide additional insights into the reasons behind these fluctuations in the cash ratio.
Peer comparison
Dec 31, 2023