The Cash Ratio measures a company’s ability to meet its short-term obligations with cash and near-cash resources. It is calculated as a company's Cash, Cash Equivalents, Marketable Securities divides by its Total Current Liabilities. The Honest Co's Cash Ratio for the quarter that ended in Dec. 2023 was 0.58.
The Honest Co has a Cash Ratio of 0.58. It indicates that there are more current liabilities than Cash, Cash Equivalents, Marketable Securities, and the company does not have sufficient cash on hand to pay off its short-term debt.
The historical rank and industry rank for The Honest Co's Cash Ratio or its related term are showing as below:
HNST'
s Cash Ratio Range Over the Past 10 Years
Min: 0.24 Med: 1.18 Max: 2.2
Current: 0.58
During the past 5 years, The Honest Co's highest Cash Ratio was 2.20. The lowest was 0.24. And the median was 1.18.
HNST's Cash Ratio is ranked better than 60.1% of 1842
companies
in the Consumer Packaged Goods industry
Industry Median: 0.39
vs HNST: 0.58
The Honest Co Cash Ratio Historical Data
The historical data trend for The Honest Co's Cash Ratio can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Competitive Comparison of The Honest Co's Cash Ratio
For the Household & Personal Products subindustry, The Honest Co's Cash Ratio, along with its competitors' market caps and Cash Ratio data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
The Honest Co's Cash Ratio Distribution in the Consumer Packaged Goods Industry
For the Consumer Packaged Goods industry and Consumer Defensive sector, The Honest Co's Cash Ratio distribution charts can be found below:
* The bar in red indicates where The Honest Co's Cash Ratio falls into.
The Honest Co Cash Ratio Calculation
The Cash Ratio measures a company's ability to meet its short-term obligations with its cash and near-cash resources.
The Honest Co's Cash Ratio for the fiscal year that ended in Dec. 2023 is calculated as:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
The Honest Co (NAS:HNST) Cash Ratio Explanation
The cash ratio is more conservative than other liquidity ratios, such as Quick Ratio and Current Ratio, because it only considers a company's most liquid resources. The numerator of cash ratio only considers Cash, Cash Equivalents and marketable securities. Other current assets, such as accounts receivable and inventories, are not included. The rationale is that these assets may require time to be transformed into cash, and the amount of money received is also uncertain.
The cash ratio shows a company’s ability to pay all current liabilities immediately without selling or liquidating other assets. Generally speaking, a higher cash ratio suggests the company has a stronger ability to cover its short-term debt. However, a high cash ratio could also indicate inefficient management: the company is inefficient in making full utilization of cash to invest protential profitable project. It may also suggest that the company is not confident about future profitability.
In general, the higher the cash ratio, the better the company's liquidity position.
The Honest Co Cash Ratio Related Terms
Thank you for viewing the detailed overview of The Honest Co's Cash Ratio provided by GuruFocus.com. Please click on the following links to see related term pages.
The Honest Co (The Honest Co) Business Description
The Honest Co Inc is a digitally-native consumer products company to make purpose-driven consumer products designed for all people. It is an omnichannel brand, ensuring its products are available wherever its consumers shop through company's Retail and Digital channels. It has three product categories namely; Diapers and Wipes, Skin and Personal Care, and Household and Wellness, out of which the majority of its revenue is generated from the sale of diapers and wipes. The company operates only in the United States.
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