Vertex Pharmaceuticals Inc (VRTX)

Cash ratio

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Cash and cash equivalents	US$ in thousands	4,569,600	10,369,100	10,504,000	6,795,000	5,988,200
Short-term investments	US$ in thousands	1,582,900	895,200	391,300	960,800	866,491
Total current liabilities	US$ in thousands	3,564,600	3,547,400	2,742,100	2,142,000	1,877,500
Cash ratio		1.73	3.18	3.97	3.62	3.65

December 31, 2024 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($4,569,600K + $1,582,900K) ÷ $3,564,600K
= 1.73

The cash ratio of Vertex Pharmaceuticals Inc has shown some fluctuations over the years based on the provided data. As of December 31, 2020, the cash ratio stood at 3.65, indicating that the company had $3.65 in cash and cash equivalents for every $1 of current liabilities. By December 31, 2021, the cash ratio decreased slightly to 3.62. However, there was an improvement in the cash ratio by December 31, 2022, reaching 3.97, suggesting an increase in the company's ability to cover its short-term liabilities with cash on hand.

On December 31, 2023, the cash ratio decreased to 3.18, which may indicate a slight decrease in liquidity compared to the previous year. Lastly, by December 31, 2024, the cash ratio dropped significantly to 1.73, potentially signaling a lower ability to meet short-term obligations purely with available cash reserves.

Overall, while the cash ratio fluctuated over the years, it remained above 1, indicating that Vertex Pharmaceuticals Inc has maintained a healthy level of cash reserves relative to its current liabilities. However, the downward trend in the cash ratio towards the end of the period may warrant further investigation into the company's liquidity management and cash position.