The current ratio is a liquidity ratio that measures a company's ability to pay short-term obligations. It is calculated as a company's Total Current Assets divides by its Total Current Liabilities. Magnetek's current ratio for the quarter that ended in Jun. 2015 was 2.94.
Magnetek has a current ratio of 2.94. It generally indicates good short-term financial strength.
The historical rank and industry rank for Magnetek's Current Ratio or its related term are showing as below:
FRA:MAJ1'
s Current Ratio Range Over the Past 10 Years
Min: 1.28 Med: 2.21 Max: 3.64
Current: 2.94
During the past 13 years, Magnetek's highest Current Ratio was 3.64. The lowest was 1.28. And the median was 2.21.
FRA:MAJ1's Current Ratio is not ranked
in the Hardware industry.
Industry Median: 2.04
vs FRA:MAJ1: 2.94
Magnetek Current Ratio Historical Data
The historical data trend for Magnetek's Current 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 Magnetek's Current Ratio
For the Electronic Components subindustry, Magnetek's Current Ratio, along with its competitors' market caps and Current 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.
Magnetek's Current Ratio Distribution in the Hardware Industry
For the Hardware industry and Technology sector, Magnetek's Current Ratio distribution charts can be found below:
* The bar in red indicates where Magnetek's Current Ratio falls into.
Magnetek Current Ratio Calculation
The current ratio is mainly used to give an idea of the company's ability to pay back its short-term liabilities with its short-term assets.
Magnetek's Current Ratio for the fiscal year that ended in Dec. 2014 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.
Magnetek (FRA:MAJ1) Current Ratio Explanation
The current ratio can give a sense of the efficiency of a company's operating cycle or its ability to turn its product into cash. Companies that have trouble getting paid on their receivables or have long inventory turnover can run into liquidity problems because they are unable to alleviate their obligations. Because business operations differ in each industry, it is always more useful to compare companies within the same industry.
Acceptable current ratios vary from industry to industry and are generally between 1 and 3 for healthy businesses.
The higher the current ratio, the more capable the company is of paying its obligations. A ratio under 1 suggests that the company would be unable to pay off its obligations if they came due at that point. While this shows the company is not in good financial health, it does not necessarily mean that it will go bankrupt - as there are many ways to access financing - but it is definitely not a good sign.
If all other things were equal, a creditor, who is expecting to be paid in the next 12 months, would consider a high current ratio to be better than a low current ratio, because a high current ratio means that the company is more likely to meet its liabilities which fall due in the next 12 months.
Magnetek Current Ratio Related Terms
Thank you for viewing the detailed overview of Magnetek's Current Ratio provided by GuruFocus.com. Please click on the following links to see related term pages.
Magnetek Inc was founded in 1984. The Company is a provider of digital power control systems that are used to control motion and power mainly in material handling, elevator, and energy delivery applications. The Company currently operates within a single business segment, digital power control systems, and sells its products to large original equipment manufacturers. The Company's systems consist mainly of programmable motion control and power conditioning systems used in the following applications: overhead cranes and hoists; elevators; coal mining equipment; and renewable energy sources. It is a North America's independent supplier of digital drives, radio controls, software and accessories for industrial cranes and hoists, and it is also a supplier of digital direct current (DC) motion control systems for elevators. The customers of Company include industrial crane and hoist companies in North America and the world's elevator builders. It is a provider of power control and delivery systems and solutions for overhead material handling applications used in industries such as: aerospace, automotive, steel, aluminum, paper, logging, mining, ship loading, nuclear power plants, locomotive yards, and heavy movable structures. The Company's material handling products include drive systems, radio remote controls, and braking, collision-avoidance, and electrification subsystems, sold mainly to original equipment manufacturers of overhead cranes and hoists. The Company also designs, builds, sells, and supports elevator application specific drive products and is recognized as a leader for DC high performance elevator drives, as well as AC drives for low and high performance traction elevators. The Company's elevator product offerings are comprised of integrated subsystems and drives used to control motion mainly in high-rise, high speed elevator applications. The Company's energy delivery product offerings include power inverters for fuel cells, solar panels and wind turbines, which deliver AC power from these energy sources to the utility power grid. The Company's main competitors included: Konecranes Inc., Power Electronics International, Inc., Cattron Group International (a division of Laird Technologies), Conductix-Wampfler (a division of Delachaux Group), Control Techniques (a division of Emerson Electric), OMRON Corporation, KEB GmbH, and Fujitec.
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