TripAdvisor Inc (TRIP)
Cash ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 1,064,000 | 1,067,000 | 1,021,000 | 723,000 | 418,000 |
| Short-term investments | US$ in thousands | — | — | — | — | 40,000 |
| Total current liabilities | US$ in thousands | 628,000 | 572,000 | 533,000 | 357,000 | 242,000 |
| Cash ratio | 1.69 | 1.87 | 1.92 | 2.03 | 1.89 |
December 31, 2024 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($1,064,000K
+ $—K)
÷ $628,000K
= 1.69
The cash ratio of TripAdvisor Inc has shown a generally stable trend over the past five years. Starting at 1.89 on December 31, 2020, the ratio increased to 2.03 by December 31, 2021, indicating an improvement in the company's ability to cover its short-term liabilities with its cash reserves. However, the ratio slightly decreased to 1.92 by the end of 2022, followed by a further decline to 1.87 by the end of 2023. The most recent data point on December 31, 2024, shows a cash ratio of 1.69, which is the lowest in the period analyzed.
Overall, while the company has maintained a healthy cash ratio above 1 throughout the period, the downward trend in the ratio from 2022 onwards raises potential concerns about the company's liquidity position. An ideal cash ratio of 1 or above indicates that the company has sufficient cash on hand to cover its short-term obligations. However, a declining trend may suggest that the company is becoming less capable of meeting its short-term liabilities solely with its cash reserves. Further analysis of the company's cash management practices and liquidity position may be necessary to understand the underlying reasons for the recent decline in the cash ratio and evaluate its potential implications for TripAdvisor Inc's financial health.
Peer comparison
Dec 31, 2024