Vestis Corporation (VSTS)
Quick ratio
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | ||
|---|---|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 48,857 | 36,051 | 30,000 | 30,000 | -23,736 | 23,736 | — |
| Short-term investments | US$ in thousands | — | — | — | — | 47,472 | — | — |
| Receivables | US$ in thousands | — | — | — | — | — | — | — |
| Total current liabilities | US$ in thousands | 393,805 | 395,525 | 367,298 | 379,244 | 368,724 | 402,195 | — |
| Quick ratio | 0.12 | 0.09 | 0.08 | 0.08 | 0.06 | 0.06 | — |
December 31, 2023 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($48,857K
+ $—K
+ $—K)
÷ $393,805K
= 0.12
Based on the quick ratio data provided for Vestis Corporation from December 31, 2022, to December 31, 2023, there is a consistent trend of the quick ratio remaining below 1. This indicates that the company may have difficulty meeting its short-term obligations with its highly liquid assets.
The quick ratio has shown a slight improvement from 0.06 in the fourth quarter of 2022 to 0.12 in the fourth quarter of 2023. However, the ratio remains relatively low, suggesting that Vestis Corporation relies heavily on its current assets to cover its current liabilities.
The quick ratio of 0.12 as of December 31, 2023, implies that for every dollar of current liabilities, the company only has $0.12 of highly liquid assets readily available to meet those obligations. This indicates a potential liquidity concern for Vestis Corporation, as a quick ratio below 1 may raise questions about the company's ability to pay off its short-term debts without facing financial strain.
In conclusion, while there has been a slight improvement in the quick ratio over the period analyzed, Vestis Corporation still faces challenges in terms of its short-term liquidity position. Continued monitoring and strategic management of working capital will be crucial for the company to improve its liquidity position and meet its financial obligations effectively.
Peer comparison
Dec 31, 2023