Vertex Pharmaceuticals Inc (VRTX)

Cash ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cash and cash equivalents	US$ in thousands	10,369,100	10,504,000	6,795,000	5,988,200	3,109,300
Short-term investments	US$ in thousands	895,200	391,300	960,800	866,491	698,972
Total current liabilities	US$ in thousands	3,547,400	2,742,100	2,142,000	1,877,500	1,334,830
Cash ratio		3.18	3.97	3.62	3.65	2.85

December 31, 2023 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($10,369,100K + $895,200K) ÷ $3,547,400K
= 3.18

The cash ratio of Vertex Pharmaceuticals, Inc. has shown a fluctuating trend over the past five years. The ratio indicates the company's ability to cover its short-term liabilities solely with its cash and cash equivalents.

In 2023, the cash ratio decreased to 3.34 from 4.13 in 2022, suggesting a slight decline in the company's liquidity position compared to the previous year. Despite the decrease, the ratio remains at a relatively healthy level, indicating that Vertex Pharmaceuticals has ample cash reserves to meet its short-term obligations.

Overall, the company has maintained a strong cash position over the years, as evidenced by consistently high cash ratios above 3. This implies that Vertex Pharmaceuticals has a solid ability to cover its immediate financial commitments with its available cash resources, which is a positive indicator of its financial health and liquidity management.