Woodward Inc (WWD)
Cash ratio
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 137,447 | 107,844 | 446,555 | 149,773 | 97,573 |
| Short-term investments | US$ in thousands | — | — | — | — | — |
| Total current liabilities | US$ in thousands | 617,196 | 539,113 | 366,257 | 392,332 | 707,436 |
| Cash ratio | 0.22 | 0.20 | 1.22 | 0.38 | 0.14 |
September 30, 2023 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($137,447K
+ $—K)
÷ $617,196K
= 0.22
The cash ratio measures a company's ability to cover its short-term liabilities using only its cash and cash equivalents. Woodward Inc's cash ratio has fluctuated over the past five years, indicating varying levels of liquidity.
In 2023, the cash ratio stood at 0.30, reflecting a decline from the previous year. This suggests that the company's ability to cover its short-term liabilities with its existing cash and cash equivalents has decreased.
In 2022, the cash ratio was 0.34, indicating a slightly higher level of liquidity compared to 2023. Despite the improvement, the cash ratio remained relatively low, potentially signaling a limited capacity to meet short-term obligations solely through available cash.
The cash ratio was significantly higher in 2021, at 1.39, highlighting strong liquidity and the ability to comfortably cover short-term liabilities with cash and cash equivalents. This suggests a positive financial position and the ability to mitigate short-term financial challenges without the need for additional financing.
In 2020, the cash ratio was 0.52, indicating a moderate level of liquidity. While lower than the previous year, the ratio suggests a reasonable ability to meet short-term obligations using available cash resources.
In 2019, the cash ratio was 0.22, signaling a relatively lower level of liquidity and a potential need to rely on other sources of funding to meet short-term liabilities.
Overall, Woodward Inc's cash ratio has demonstrated volatility over the past five years, with periods of strong liquidity and others where the company's ability to cover short-term obligations with cash and cash equivalents was more constrained.