Analysis of Liquidity Ratios
Liquidity ratios measure the company ability to meet its short-term obligations.
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- Cash Flow Statement
- Common-Size Income Statement
- Common-Size Balance Sheet: Assets
- Operating Profit Margin since 2005
- Return on Assets (ROA) since 2005
- Current Ratio since 2005
- Debt to Equity since 2005
- Total Asset Turnover since 2005
- Price to Operating Profit (P/OP) since 2005
- Price to Sales (P/S) since 2005
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Liquidity Ratios (Summary)
Costco Wholesale Corp., liquidity ratios
| Sep 1, 2024 | Sep 3, 2023 | Aug 28, 2022 | Aug 29, 2021 | Aug 30, 2020 | Sep 1, 2019 | ||
|---|---|---|---|---|---|---|---|
| Current ratio | |||||||
| Quick ratio | |||||||
| Cash ratio |
Based on: 10-K (reporting date: 2024-09-01), 10-K (reporting date: 2023-09-03), 10-K (reporting date: 2022-08-28), 10-K (reporting date: 2021-08-29), 10-K (reporting date: 2020-08-30), 10-K (reporting date: 2019-09-01).
- Current Ratio
- The current ratio exhibits moderate fluctuations over the observed periods. Starting at 1.01 in 2019, it increased to 1.13 in 2020, indicating an improvement in short-term liquidity. However, the ratio declined to 1.0 in 2021 and then showed slight variability around 1.02 and 1.07 in 2022 and 2023, respectively. In 2024, the current ratio dropped below 1 to 0.97, which may suggest a reduced ability to cover current liabilities with current assets.
- Quick Ratio
- The quick ratio displays a similar pattern of fluctuation but remains consistently below 1, highlighting a reliance on inventory to meet short-term obligations. It increased from 0.47 in 2019 to 0.6 in 2020, representing better liquidity without inventory. From 2021 onwards, it decreased to 0.47, further dropped to 0.42 in 2022, then rose to 0.52 in 2023 before falling again to 0.39 in 2024. The downward trend in the most recent period points to a decrease in liquid assets relative to current liabilities.
- Cash Ratio
- The cash ratio follows a generally downward trend despite some fluctuations. It started at 0.41 in 2019, increased to 0.54 in 2020, and then steadily decreased to 0.41 in 2021 and 0.35 in 2022. A rebound to 0.45 in 2023 was followed by a decline to 0.31 in 2024, marking the lowest point within the observed timeframe. This trend suggests a diminishing cash position relative to current liabilities, potentially affecting the company's immediate liquidity.
Current Ratio
Costco Wholesale Corp., current ratio calculation, comparison to benchmarks
| Sep 1, 2024 | Sep 3, 2023 | Aug 28, 2022 | Aug 29, 2021 | Aug 30, 2020 | Sep 1, 2019 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Current assets | |||||||
| Current liabilities | |||||||
| Liquidity Ratio | |||||||
| Current ratio1 | |||||||
| Benchmarks | |||||||
| Current Ratio, Competitors2 | |||||||
| Target Corp. | |||||||
| Walmart Inc. | |||||||
| Current Ratio, Sector | |||||||
| Consumer Staples Distribution & Retail | |||||||
| Current Ratio, Industry | |||||||
| Consumer Staples | |||||||
Based on: 10-K (reporting date: 2024-09-01), 10-K (reporting date: 2023-09-03), 10-K (reporting date: 2022-08-28), 10-K (reporting date: 2021-08-29), 10-K (reporting date: 2020-08-30), 10-K (reporting date: 2019-09-01).
1 2024 Calculation
Current ratio = Current assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Current assets
- The current assets exhibit a consistent upward trend from 23,485 million USD in 2019 to 35,879 million USD in 2023. However, there is a slight decline in 2024, with current assets decreasing to 34,246 million USD. This indicates a general increase in short-term resources available to the company over the analyzed period, despite a minor reduction in the latest year.
- Current liabilities
- Current liabilities also show a steady increase throughout the period. Starting at 23,237 million USD in 2019, they rise to 33,583 million USD in 2023, and further increase to 35,464 million USD in 2024. The continuous growth in current liabilities suggests increasing short-term obligations.
- Current ratio
- The current ratio begins near parity at 1.01 in 2019 and peaks at 1.13 in 2020. Subsequently, it fluctuates slightly, falling to 1 in 2021, then rising to 1.07 in 2023 before declining below 1 to 0.97 in 2024. The ratio's movement indicates that the company's liquidity position improved briefly but has generally been close to or slightly below the threshold of 1. A ratio below 1 in the latest year suggests that current liabilities exceed current assets, potentially signaling tighter liquidity.
- Overall analysis
- Over the analyzed years, both current assets and current liabilities have increased, with liabilities growing at a somewhat faster pace toward the end of the period. The declining current ratio in 2024 indicates a slight deterioration in liquidity, reflecting increased short-term obligations relative to short-term assets. This may call for attention to working capital management to ensure sufficient liquidity.
Quick Ratio
Costco Wholesale Corp., quick ratio calculation, comparison to benchmarks
| Sep 1, 2024 | Sep 3, 2023 | Aug 28, 2022 | Aug 29, 2021 | Aug 30, 2020 | Sep 1, 2019 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Cash and cash equivalents | |||||||
| Short-term investments | |||||||
| Receivables, net | |||||||
| Total quick assets | |||||||
| Current liabilities | |||||||
| Liquidity Ratio | |||||||
| Quick ratio1 | |||||||
| Benchmarks | |||||||
| Quick Ratio, Competitors2 | |||||||
| Target Corp. | |||||||
| Walmart Inc. | |||||||
| Quick Ratio, Sector | |||||||
| Consumer Staples Distribution & Retail | |||||||
| Quick Ratio, Industry | |||||||
| Consumer Staples | |||||||
Based on: 10-K (reporting date: 2024-09-01), 10-K (reporting date: 2023-09-03), 10-K (reporting date: 2022-08-28), 10-K (reporting date: 2021-08-29), 10-K (reporting date: 2020-08-30), 10-K (reporting date: 2019-09-01).
1 2024 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Total quick assets
- The total quick assets showed an overall increase from 2019 to 2024 with some fluctuations. The amount rose significantly from 10,979 million USD in 2019 to a peak of 17,519 million USD in 2023, before declining to 13,865 million USD in 2024. This indicates variability in liquid asset availability across the years, with a notable drop in the most recent period.
- Current liabilities
- Current liabilities increased steadily throughout the analyzed period. Beginning at 23,237 million USD in 2019, liabilities rose consistently each year, reaching 35,464 million USD in 2024. This steady growth suggests increasing short-term obligations or operational scale over time.
- Quick ratio
- The quick ratio fluctuated within a relatively narrow range, indicating changes in the company's short-term liquidity position. The ratio started at 0.47 in 2019, increased to 0.60 in 2020, but then declined to 0.39 by 2024, showing a weakening ability to cover current liabilities with quick assets in the most recent year. Peaks and troughs within the period reflect varying liquidity management or asset and liability changes.
Cash Ratio
Costco Wholesale Corp., cash ratio calculation, comparison to benchmarks
| Sep 1, 2024 | Sep 3, 2023 | Aug 28, 2022 | Aug 29, 2021 | Aug 30, 2020 | Sep 1, 2019 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Cash and cash equivalents | |||||||
| Short-term investments | |||||||
| Total cash assets | |||||||
| Current liabilities | |||||||
| Liquidity Ratio | |||||||
| Cash ratio1 | |||||||
| Benchmarks | |||||||
| Cash Ratio, Competitors2 | |||||||
| Target Corp. | |||||||
| Walmart Inc. | |||||||
| Cash Ratio, Sector | |||||||
| Consumer Staples Distribution & Retail | |||||||
| Cash Ratio, Industry | |||||||
| Consumer Staples | |||||||
Based on: 10-K (reporting date: 2024-09-01), 10-K (reporting date: 2023-09-03), 10-K (reporting date: 2022-08-28), 10-K (reporting date: 2021-08-29), 10-K (reporting date: 2020-08-30), 10-K (reporting date: 2019-09-01).
1 2024 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Total cash assets
- The total cash assets exhibited fluctuations over the observed periods. Initially, there was a notable increase from 9,444 million USD in 2019 to a peak of 13,305 million USD in 2020. Subsequently, a decline occurred, reducing cash assets to 12,175 million USD in 2021 and further down to 11,049 million USD in 2022. A strong recovery is evident in 2023, with cash assets reaching 15,234 million USD, the highest value in the period. However, the figure dropped again in 2024 to 11,144 million USD.
- Current liabilities
- Current liabilities showed a consistent upward trend throughout the period. Beginning at 23,237 million USD in 2019, liabilities increased steadily each year, reaching 35,464 million USD by 2024. This represents a significant rise of over 52% from the starting point.
- Cash ratio
- The cash ratio demonstrated variability corresponding to changes in cash assets and current liabilities. Starting at 0.41 in 2019, the ratio increased to 0.54 in 2020, indicating a stronger liquidity position. This was followed by a decrease to 0.41 in 2021 and a further decline to 0.35 in 2022. A temporary improvement to 0.45 occurred in 2023, but the ratio fell to 0.31 in 2024, the lowest within the timeframe. Overall, the trend suggests diminishing liquidity relative to current liabilities, particularly in the most recent year.