UFP Technologies Inc (UFPT)

Quick 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	US$ in thousands	5,263	6,376	5,291	6,503	4,451	9,937	5,576	3,652	11,117	33,094	30,273	25,377	24,234	17,435	12,266	7,334	3,743	11,390	5,231	2,493
Short-term investments	US$ in thousands	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Receivables	US$ in thousands	64,449	60,968	64,090	60,142	55,117	61,477	57,913	46,182	39,384	32,456	31,222	30,018	26,428	27,940	27,271	30,018	28,648	30,832	30,681	29,772
Total current liabilities	US$ in thousands	58,209	56,588	52,993	52,192	55,961	57,400	53,382	38,824	38,783	18,760	19,639	16,668	15,137	16,063	16,565	17,462	16,784	21,361	20,905	18,970
Quick ratio		1.20	1.19	1.31	1.28	1.06	1.24	1.19	1.28	1.30	3.49	3.13	3.32	3.35	2.82	2.39	2.14	1.93	1.98	1.72	1.70

December 31, 2023 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($5,263K + $—K + $64,449K) ÷ $58,209K
= 1.20

The quick ratio, also known as the acid-test ratio, measures a company's ability to meet its short-term obligations with its most liquid assets. A quick ratio of 1 or higher indicates that a company has enough liquid assets to cover its current liabilities.

In the case of UFP Technologies Inc, the quick ratio has shown fluctuations over the past few quarters. The quick ratio ranged from a low of 1.06 to a high of 3.49 during the period covered in the table.

During the latest quarter, the quick ratio stood at 1.20, which implies that the company had $1.20 of quick assets available for every $1 of current liabilities. This indicates that UFP Technologies Inc has a reasonable level of liquidity to cover its short-term obligations.

It is worth noting that the quick ratio significantly increased in the third quarter of 2021 and remained at a high level for the following quarters, indicating a strong liquidity position during that period. However, from the fourth quarter of 2022 onwards, the quick ratio started to fluctuate, albeit staying above 1, which is generally considered a satisfactory level.

Overall, a quick ratio above 1 suggests that UFP Technologies Inc has the ability to meet its short-term obligations using its liquid assets, providing a degree of comfort to creditors and investors regarding the company's financial health in the short term.