Vector Group Ltd (VGR)
Cash ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 268,600 | 224,580 | 193,411 | 258,421 | 299,856 |
| Short-term investments | US$ in thousands | 110,935 | 116,436 | 146,687 | 78,599 | 46,196 |
| Total current liabilities | US$ in thousands | 144,923 | 175,624 | 165,290 | 283,315 | 461,133 |
| Cash ratio | 2.62 | 1.94 | 2.06 | 1.19 | 0.75 |
December 31, 2023 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($268,600K
+ $110,935K)
÷ $144,923K
= 2.62
The cash ratio measures a company's ability to cover its short-term obligations with its available cash and cash equivalents. The trend of Vector Group Ltd's cash ratio over the past five years shows a generally positive improvement in liquidity.
In 2019, the cash ratio was 1.18, indicating that the company had $1.18 in cash and cash equivalents for every dollar of current liabilities. Over the subsequent years, this ratio has steadily increased to 2.70 as of December 31, 2023. This suggests that Vector Group Ltd has significantly strengthened its liquidity position, with more cash on hand relative to its short-term liabilities.
The rising trend in the cash ratio reflects the company's ability to generate and retain sufficient cash reserves to meet its immediate obligations. A higher cash ratio implies a lower risk of default on short-term liabilities and greater financial stability.
Overall, the increasing cash ratio of Vector Group Ltd signals an enhanced ability to weather unexpected financial challenges and suggests a prudent approach to managing its liquidity levels.
Peer comparison
Dec 31, 2023