Liquidity Ratios

See: Current Ratio. See: Quick Ratio.

These ratios ask, "How cash-comfy are you to continue operations?" More or less.

When a company has way more cash than they do debt, they have high liquidity. When they have more current assets, i.e. assets ready to sell (easily) than they do interest payments, then they are liquid.

High liquidity ratios, good; low liquidity ratios, bad.