Watsco Inc (WSO)
Quick ratio
| Dec 31, 2024 | Sep 30, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 526,271 | 294,354 | 424,854 | 278,864 | 210,112 | 175,022 | 162,526 | 140,955 | 147,505 | 130,228 | 129,049 | 110,607 | 118,268 | 137,201 | 96,787 | 93,875 | 146,067 | 92,600 | 79,573 | 51,236 |
| Short-term investments | US$ in thousands | 255,669 | 255,669 | 200,000 | 200,000 | 0 | — | — | — | — | — | — | — | — | 111,776 | — | 102,518 | 97,847 | 103,355 | — | — |
| Receivables | US$ in thousands | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Total current liabilities | US$ in thousands | 983,901 | 933,149 | 945,167 | 1,026,130 | 712,012 | 887,628 | 955,999 | 953,083 | 906,522 | 939,522 | 1,061,340 | 836,839 | 726,722 | 796,693 | 815,264 | 630,820 | 499,715 | 609,498 | 638,858 | 520,474 |
| Quick ratio | 0.79 | 0.59 | 0.66 | 0.47 | 0.30 | 0.20 | 0.17 | 0.15 | 0.16 | 0.14 | 0.12 | 0.13 | 0.16 | 0.31 | 0.12 | 0.31 | 0.49 | 0.32 | 0.12 | 0.10 |
December 31, 2024 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($526,271K
+ $255,669K
+ $—K)
÷ $983,901K
= 0.79
The quick ratio of Watsco Inc, a key liquidity ratio, shows the company's ability to meet its short-term obligations with its most liquid assets. From March 31, 2020, to December 31, 2024, the quick ratio fluctuated significantly. It started very low at 0.10 in March 2020 but gradually improved to 0.79 by December 2024.
The lowest quick ratio was observed in June 2021 at 0.12, indicating a potential liquidity concern. However, improvements were made, and the ratio increased to 0.30 by December 2023. This positive trend continued into 2024, reaching the highest quick ratio of 0.79 by December 31, 2024, indicating a stronger ability to cover short-term liabilities with liquid assets.
Overall, while there were fluctuations in Watsco Inc's quick ratio over the period, the company managed to improve its liquidity position, which is a positive indicator for its short-term financial stability.