West Pharmaceutical Services Inc (WST)
Quick ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 853,900 | 894,300 | 762,600 | 615,500 | 439,100 |
| Short-term investments | US$ in thousands | — | — | — | 214,000 | — |
| Receivables | US$ in thousands | 512,000 | 507,400 | 489,000 | 385,300 | 319,300 |
| Total current liabilities | US$ in thousands | 671,800 | 519,000 | 594,100 | 503,400 | 341,600 |
| Quick ratio | 2.03 | 2.70 | 2.11 | 2.41 | 2.22 |
December 31, 2023 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($853,900K
+ $—K
+ $512,000K)
÷ $671,800K
= 2.03
The quick ratio of West Pharmaceutical Services, Inc. has shown some fluctuations over the past five years, ranging from 2.09 in 2020 to 2.90 in 2022. The quick ratio measures the company's ability to meet its short-term obligations with its most liquid assets. A quick ratio above 1 indicates that the company has enough liquid assets to cover its current liabilities.
The company's quick ratio has generally been above 2 in recent years, indicating a strong ability to meet its short-term obligations. The significant decrease in the quick ratio in 2022 suggests a potential reduction in the company's ability to cover its short-term liabilities with its most liquid assets, although it remained well above 1.
Overall, the trend in the quick ratio for West Pharmaceutical Services, Inc. signifies a relatively stable liquidity position, with the company maintaining a healthy level of liquidity to meet its short-term financial obligations throughout the years analyzed.
Peer comparison
Dec 31, 2023