3M Co. (MMM) | Liquidity Analysis

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Liquidity ratios measure the company's ability to meet its short-term obligations.

Ratios (Summary)

3M Co., liquidity ratios

	Dec 31, 2010	Dec 31, 2009	Dec 31, 2008	Dec 31, 2007	Dec 31, 2006
Current ratio	2.01	2.20	1.64	1.83	1.22
Quick ratio	1.33	1.44	0.93	1.09	0.69
Cash ratio	0.74	0.77	0.38	0.46	0.26

Source: Based on data from 3M Co. Annual Reports

Ratio	Description	The company
Current ratio	A liquidity ratio calculated as current assets divided by current liabilities.	3M Co.'s current ratio improved from 2008 to 2009 but then slightly deteriorated from 2009 to 2010.
Quick ratio	A liquidity ratio calculated as (cash plus short-term marketable investments plus receivables) divided by current liabilities.	3M Co.'s quick ratio improved from 2008 to 2009 but then slightly deteriorated from 2009 to 2010.
Cash ratio	A liquidity ratio calculated as (cash plus short-term marketable investments) divided by current liabilities.	3M Co.'s cash ratio improved from 2008 to 2009 but then slightly deteriorated from 2009 to 2010.

	Dec 31, 2010	Dec 31, 2009	Dec 31, 2008	Dec 31, 2007	Dec 31, 2006
Selected Financial Data (USD $ in millions)
Current assets	12,215	10,795	9,598	9,838	8,946
Current liabilities	6,089	4,897	5,839	5,362	7,323
Current Ratio, Comparison to Industry
3M Co.¹	2.01	2.20	1.64	1.83	1.22
Industry, Industrials	1.30	1.21	1.07	1.08	–

Source: Based on data from 3M Co. Annual Reports

2010 Calculations

¹ Current ratio = Current assets ÷ Current liabilities
= 12,215 ÷ 6,089 = 2.01

Ratio	Description	The company
Current ratio	A liquidity ratio calculated as current assets divided by current liabilities.	3M Co.'s current ratio improved from 2008 to 2009 but then slightly deteriorated from 2009 to 2010.

	Dec 31, 2010	Dec 31, 2009	Dec 31, 2008	Dec 31, 2007	Dec 31, 2006
Selected Financial Data (USD $ in millions)
Cash and cash equivalents	3,377	3,040	1,849	1,896	1,447
Marketable securities, current	1,101	744	373	579	471
Accounts receivable, net of allowances	3,615	3,250	3,195	3,362	3,102
Total quick assets	8,093	7,034	5,417	5,837	5,020
Current liabilities	6,089	4,897	5,839	5,362	7,323
Quick Ratio, Comparison to Industry
3M Co.¹	1.33	1.44	0.93	1.09	0.69
Industry, Industrials	0.81	0.75	0.64	0.61	–

Source: Based on data from 3M Co. Annual Reports

2010 Calculations

¹ Quick ratio = Total quick assets ÷ Current liabilities
= 8,093 ÷ 6,089 = 1.33

Ratio	Description	The company
Quick ratio	A liquidity ratio calculated as (cash plus short-term marketable investments plus receivables) divided by current liabilities.	3M Co.'s quick ratio improved from 2008 to 2009 but then slightly deteriorated from 2009 to 2010.

	Dec 31, 2010	Dec 31, 2009	Dec 31, 2008	Dec 31, 2007	Dec 31, 2006
Selected Financial Data (USD $ in millions)
Cash and cash equivalents	3,377	3,040	1,849	1,896	1,447
Marketable securities, current	1,101	744	373	579	471
Total cash assets	4,478	3,784	2,222	2,475	1,918
Current liabilities	6,089	4,897	5,839	5,362	7,323
Cash Ratio, Comparison to Industry
3M Co.¹	0.74	0.77	0.38	0.46	0.26
Industry, Industrials	0.37	0.32	0.21	0.19	–

Source: Based on data from 3M Co. Annual Reports

2010 Calculations

¹ Cash ratio = Total cash assets ÷ Current liabilities
= 4,478 ÷ 6,089 = 0.74

Ratio	Description	The company
Cash ratio	A liquidity ratio calculated as (cash plus short-term marketable investments) divided by current liabilities.	3M Co.'s cash ratio improved from 2008 to 2009 but then slightly deteriorated from 2009 to 2010.