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. IPG Photonics's current ratio for the quarter that ended in Dec. 2023 was 8.91.
IPG Photonics has a current ratio of 8.91. It indicates the company may not be efficiently using its current assets or its short-term financing facilities. This may also indicate problems in working capital management.
The historical rank and industry rank for IPG Photonics's Current Ratio or its related term are showing as below:
IPGP'
s Current Ratio Range Over the Past 10 Years
Min: 7.23 Med: 8 Max: 10.01
Current: 8.91
During the past 13 years, IPG Photonics's highest Current Ratio was 10.01. The lowest was 7.23. And the median was 8.00.
IPGP's Current Ratio is ranked better than 90.4% of 1000
companies
in the Semiconductors industry
Industry Median: 2.45
vs IPGP: 8.91
IPG Photonics Current Ratio Historical Data
The historical data trend for IPG Photonics'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 IPG Photonics's Current Ratio
For the Semiconductor Equipment & Materials subindustry, IPG Photonics'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.
IPG Photonics's Current Ratio Distribution in the Semiconductors Industry
For the Semiconductors industry and Technology sector, IPG Photonics's Current Ratio distribution charts can be found below:
* The bar in red indicates where IPG Photonics's Current Ratio falls into.
IPG Photonics 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.
IPG Photonics's Current 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.
IPG Photonics (NAS:IPGP) 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.
IPG Photonics Current Ratio Related Terms
Thank you for viewing the detailed overview of IPG Photonics's Current Ratio provided by GuruFocus.com. Please click on the following links to see related term pages.
IPG Photonics (IPG Photonics) Business Description
IPG Photonics Corp is a vertically integrated developer and manufacturer of high-performance fiber lasers, fiber amplifiers, and diode lasers, which are used in diverse applications in the manufacturing, automotive, industrial, aerospace, semiconductor, and consumer end markets. A large majority of the firm's revenue is derived from materials processing applications for fiber lasers, including cutting and welding, marking and engraving, and micro-processing. Roughly a third of the firm's revenue is generated in China, with the rest coming from North America, Europe, Japan, Australia, and other countries across the world.
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