Wolfspeed Inc (WOLF)

Cash ratio

		Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021	Jun 30, 2020
Cash and cash equivalents	US$ in thousands	1,045,900	1,757,000	449,500	379,000	448,800
Short-term investments	US$ in thousands	1,128,700	1,197,900	749,300	775,600	790,900
Total current liabilities	US$ in thousands	665,300	627,900	388,500	448,800	291,200
Cash ratio		3.27	4.71	3.09	2.57	4.26

June 30, 2024 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($1,045,900K + $1,128,700K) ÷ $665,300K
= 3.27

The cash ratio of Wolfspeed Inc has fluctuated over the past five years. In the most recent period ending on June 30, 2024, the cash ratio stood at 3.27, indicating that the company had $3.27 in cash and cash equivalents for every dollar of current liabilities. This represents a decrease from the previous year's ratio of 4.71, suggesting a reduction in the company's liquidity position.

Comparing the cash ratio to earlier years, we observe variations in the company's ability to cover its short-term liabilities with cash on hand. The trend shows that the cash ratio was relatively stable between 2020 and 2023, with a slight peak in 2021 at 4.26 before declining in subsequent years.

Overall, while the cash ratio provides insight into Wolfspeed Inc's short-term liquidity and ability to meet immediate obligations using its cash reserves, fluctuations in the ratio over the years indicate changes in the company's cash management practices and liquidity position. Further analysis and comparison with industry benchmarks may be necessary to assess the company's cash management efficiency effectively.