Amgen Inc. (NASDAQ:AMGN)

Current Ratio

The current ratio exhibits notable fluctuations over the observed periods. Starting at 1.59 in March 2020, it reached a peak of 2.28 in September 2020 before declining to 1.31 by June 2021. Another peak is observed in March 2023 with a value of 3.14, indicating a significant increase in short-term liquidity. Following this peak, the ratio generally trends downward, stabilizing around values slightly above 1.2 towards mid-2025. These variations suggest periods of strengthened liquidity management interspersed with phases of contraction in current assets relative to current liabilities.

Quick Ratio

The quick ratio shows a similar pattern to the current ratio with periodic rises and declines. It increased from 1.1 in March 2020 to a high of 1.65 in September 2020, followed by a substantial dip to 0.86 in June 2021. The ratio surged to a peak of 2.62 in March 2023, paralleling the trend of the current ratio. Post this peak, it decreases sharply to below 1.0 by December 2023 and stabilizes around 0.75 to 0.82 in the latter quarters, indicating a more conservative level of liquid assets relative to current liabilities excluding inventories.

Cash Ratio

The cash ratio trends similarly but demonstrates more pronounced volatility and generally lower values compared to the other liquidity measures. Beginning at 0.68 in March 2020, it increased to 1.24 by September 2020, then receded to 0.55 in June 2021. Thereafter, a marked spike occurs in March 2023 reaching 2.22, after which the ratio declines significantly, settling near 0.38-0.52 by mid-2025. This progression indicates fluctuating levels of cash and cash equivalents to cover current liabilities, with a notable peak reflecting a temporary buildup of cash reserves.

The analysis of the quarterly financial data reveals distinct patterns in the liquidity position over the periods observed. The current assets and current liabilities exhibit fluctuations that influence the current ratio, a key indicator of short-term financial health.

Current Assets

Current assets show variability throughout the reported quarters. Initial values start at 18,813 million USD at the end of Q1 2020, rising to a peak of 48,477 million USD by Q3 2023. This peak is followed by a decrease to 26,734 million USD by Q2 2025. The data indicates periods of accumulation and reduction, with notable surges in early 2023 and a subsequent decline toward mid-2025.

Current Liabilities

Current liabilities also fluctuate over the same time frame. Beginning at 11,827 million USD at Q1 2020, they generally trend upward with some variation, reaching a maximum of 23,099 million USD in Q1 2025, before slightly decreasing to 20,476 million USD by Q2 2025. The liabilities' growth tends to parallel, though not always proportionally, the changes observed in current assets.

Current Ratio

The current ratio, calculated as current assets divided by current liabilities, reflects the company's liquidity strength. It started at 1.59 in Q1 2020, experienced a peak at 2.28 in Q3 2020, then declined to approximately 1.31 by mid-2021. An extraordinary spike occurred in Q1 2023, reaching 3.14, which suggests a temporary buildup of assets relative to liabilities. Subsequently, the ratio decreased again, stabilizing around a range of 1.17 to 1.42 from mid-2024 to mid-2025. The overall trend suggests that liquidity improved notably in early 2023 but returned to more moderate levels afterward.

In summary, the liquidity profile has been characterized by significant fluctuations, including a marked increase in current assets and an improved current ratio during early 2023, followed by reductions towards the later periods. Current liabilities have generally increased, but not as sharply as assets in certain quarters, influencing the variability in the current ratio. The current ratio staying predominantly above 1.0 throughout indicates maintenance of a short-term solvency buffer, albeit with periods of tighter liquidity.

Quick Assets and Current Liabilities Trends

Total quick assets exhibited notable volatility over the observed periods. There was an initial increase from 13,021 million USD in March 2020 to a peak of 17,686 million USD in September 2021, followed by a fluctuating pattern, including a significant surge to 40,886 million USD by September 2023. This sharp rise contrasts with a subsequent decrease to approximately 16,729 million USD by June 2025.

Current liabilities demonstrated a generally upward trend across the timeframe, rising from 11,827 million USD in March 2020 to a peak of 23,099 million USD in March 2025. Some fluctuations occurred, such as a temporary drop in December 2021 and December 2024, but the overall direction was an increase in liabilities.

Quick Ratio Dynamics

The quick ratio reflected significant variability, indicating changes in short-term liquidity. Early on, it moved from 1.1 in March 2020 up to 1.65 in September 2020, then declined to 0.86 in June 2021. A recovery followed, reaching a very high level of 2.62 in March 2023. However, subsequently, the ratio decreased markedly to values below 1.0, hovering around 0.74 to 0.82 from June 2024 through June 2025.

The periods of high quick ratio in 2023 suggest a strong liquidity position with more than twice the quick assets relative to current liabilities. Conversely, ratios below 1.0 in later periods imply tighter liquidity, where quick assets are insufficient to cover current liabilities fully.

Overall Observations

The data reveals episodic surges in liquid asset availability contrasting with periods of relative liquidity constraints. The substantial increase in quick assets around 2023, followed by rapid reduction, may indicate extraordinary events or asset reclassification impacting liquidity.

Concurrently, the steady rise in current liabilities signals increasing short-term obligations, which, combined with declining quick ratios in recent periods, could raise concerns about the ability to meet near-term liabilities without reliance on less liquid assets.

The fluctuating quick ratio underscores a variable liquidity profile, suggesting the need for continuous monitoring and possibly strategic adjustments to ensure adequate short-term financial flexibility.

The analysis of the quarterly financial data reveals several notable trends and fluctuations in the liquidity position of the company over the examined periods.

Total Cash Assets

Total cash assets exhibit considerable volatility across the quarters. Initial levels in early 2020 show moderate values around 8,000 to 12,000 million USD. A sharp increase is observed in the first quarter of 2023, peaking at over 34,000 million USD, followed by a significant decline in the last quarter of 2023 and stabilization around 9,000 to 12,000 million USD in 2024 and mid-2025. This pattern suggests episodes of substantial cash inflow or temporary holdings that were later drawn down.

Current Liabilities

Current liabilities generally demonstrate an increasing trend over the entire timeline. Starting at approximately 11,800 million USD in early 2020, liabilities continuously rise with some fluctuations, reaching a peak near 23,000 million USD by mid-2025. The incremental increase in liabilities coupled with fluctuations in cash assets indicates rising short-term obligations, which may impact liquidity management.

Cash Ratio

The cash ratio, representing the company's ability to cover current liabilities with cash and cash equivalents, shows significant volatility and notable peaks and troughs. Early 2020 to early 2021 ratios vary from below 1 to slightly above 1.0, reflecting periods of stronger liquidity and tighter cash reserves. During the first three quarters of 2023, the cash ratio sharply rises to levels above 2.0, coinciding with the surge in cash assets, indicating enhanced liquidity during that period. However, this liquidity advantage diminishes rapidly thereafter, with ratios falling back below 0.6 throughout 2024 and mid-2025, indicating a lower liquidity cushion relative to short-term liabilities.

Overall, the financial data presents a scenario of fluctuating liquidity capacity with periods of strong cash accumulation alternating with phases of tighter cash conditions. The upward trajectory in current liabilities suggests increasing short-term financial commitments, which alongside the variable cash positions, may require effective working capital and cash management strategies to maintain financial stability.