Trex Company Inc (TREX)
Quick ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 1,959 | 12,325 | 141,053 | 121,701 | 148,833 |
| Short-term investments | US$ in thousands | — | — | — | — | — |
| Receivables | US$ in thousands | 50,747 | 122,036 | 151,502 | 114,571 | 81,137 |
| Total current liabilities | US$ in thousands | 91,062 | 290,599 | 88,702 | 106,353 | 78,670 |
| Quick ratio | 0.58 | 0.46 | 3.30 | 2.22 | 2.92 |
December 31, 2023 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($1,959K
+ $—K
+ $50,747K)
÷ $91,062K
= 0.58
The quick ratio of TREX Co., Inc. has shown fluctuations over the past five years. In 2023, the quick ratio stands at 0.72, indicating that the company may have difficulty meeting its short-term obligations using its most liquid assets. Compared to the previous year, the quick ratio has improved from 0.50 in 2022, suggesting a better ability to cover immediate liabilities.
The significant decrease in the quick ratio from 3.58 in 2021 to 0.50 in 2022 raised concerns about the company's liquidity position. However, the quick ratio had been relatively stable and healthy in the years prior, with values of 2.39 in 2020 and 3.14 in 2019, signaling a strong ability to meet short-term obligations with quick assets.
Overall, while the recent decrease in the quick ratio may indicate a temporary liquidity challenge, the company's historical performance demonstrates a generally satisfactory liquidity position. It would be important to further investigate the factors influencing these fluctuations to assess the company's financial health accurately.
Peer comparison
Dec 31, 2023