Trex Company Inc (TREX)
Current ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total current assets | US$ in thousands | 172,254 | 286,842 | 401,054 | 321,997 | 303,204 |
| Total current liabilities | US$ in thousands | 91,062 | 290,599 | 88,702 | 106,353 | 78,670 |
| Current ratio | 1.89 | 0.99 | 4.52 | 3.03 | 3.85 |
December 31, 2023 calculation
Current ratio = Total current assets ÷ Total current liabilities
= $172,254K ÷ $91,062K
= 1.89
The current ratio of TREX Co., Inc. has fluctuated over the past five years, ranging from 0.99 to 4.52. A current ratio above 1 indicates that the company has more current assets than current liabilities, which is generally considered favorable.
In 2023, the current ratio improved significantly to 1.89 compared to the previous year, suggesting that the company's ability to meet its short-term obligations has strengthened. However, it is still below the levels seen in 2021 and 2019. The relatively lower current ratio in 2022 could indicate potential liquidity challenges or higher short-term debt obligations.
The 2021 current ratio of 4.52 was notably high, indicating a robust liquidity position with ample current assets to cover short-term liabilities. This could be a result of efficient working capital management or a reduction in short-term debt levels.
Overall, TREX Co., Inc.'s current ratio performance indicates variability in its short-term liquidity position over the past five years, with fluctuations that may reflect changes in the company's financial health, efficiency of operations, or management of current assets and liabilities. Further analysis of the underlying components of current assets and liabilities would provide a more comprehensive understanding of the company's liquidity management.
Peer comparison
Dec 31, 2023