Wolfspeed Inc (WOLF)

Cash ratio

		Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019
Cash and cash equivalents	US$ in thousands	1,045,900	1,142,400	904,400	1,762,000	1,757,000	795,100	1,085,100	521,600	449,500	485,900	185,400	261,500	379,000	531,600	388,100	436,400	448,800	323,000	382,600	433,300
Short-term investments	US$ in thousands	1,128,700	1,408,500	1,731,300	1,585,600	1,197,900	1,453,100	1,399,300	675,600	749,300	800,200	501,100	596,300	775,600	761,700	580,600	702,100	790,900	529,900	568,900	560,600
Total current liabilities	US$ in thousands	665,300	727,000	671,200	749,300	627,900	607,200	460,000	380,800	388,500	322,600	341,000	319,000	448,800	382,800	385,600	343,400	291,200	251,400	248,500	242,700
Cash ratio		3.27	3.51	3.93	4.47	4.71	3.70	5.40	3.14	3.09	3.99	2.01	2.69	2.57	3.38	2.51	3.32	4.26	3.39	3.83	4.10

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 shown fluctuations over the past few quarters. The ratio indicates the company's ability to cover its short-term liabilities with its available cash and cash equivalents. A higher cash ratio is generally preferred as it signifies a stronger liquidity position.

Looking at the trend, the cash ratio peaked at 5.40 in December 2022, indicating that the company had a significant amount of cash relative to its current liabilities at that point in time. However, the ratio declined in the subsequent quarters but remained above 3.00, indicating a relatively healthy liquidity position.

It is important to note that a cash ratio above 1.00 means that the company has enough cash to cover its short-term liabilities. Therefore, Wolfspeed Inc consistently maintaining a cash ratio above 3.00 suggests that it has a comfortable cushion of liquid assets to meet its immediate financial obligations.

Overall, the cash ratio analysis suggests that Wolfspeed Inc has been managing its liquidity well, maintaining a healthy level of cash reserves relative to its short-term liabilities over the analyzed periods.