Liquidity ratios measure the company ability to meet its short-term obligations.
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- Income Statement
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- Analysis of Solvency Ratios
- Analysis of Reportable Segments
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- Dividend Discount Model (DDM)
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- Total Asset Turnover since 2015
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Liquidity Ratios (Summary)
Dec 28, 2019 | Dec 29, 2018 | Dec 30, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
---|---|---|---|---|---|---|
Current ratio | ||||||
Quick ratio | ||||||
Cash ratio |
Based on: 10-K (reporting date: 2019-12-28), 10-K (reporting date: 2018-12-29), 10-K (reporting date: 2017-12-30), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).
The analysis of the provided liquidity ratios over the five-year period reveals several notable trends concerning the company's short-term financial health.
- Current Ratio
- The current ratio experiences a significant decline from 1.41 in 2015 to 0.72 in 2017, indicating a decrease in the company's ability to cover its short-term liabilities with current assets during this period. However, it partially recovers thereafter, rising to 1.21 in 2018 before slightly decreasing again to 1.03 in 2019. Despite the recovery, the ending ratio remains close to the threshold level of 1, suggesting a moderate liquidity position.
- Quick Ratio
- Mirroring the current ratio, the quick ratio shows a steady decline from 0.91 in 2015 to a low of 0.29 in 2017, highlighting a reduction in the company's most liquid assets relative to its short-term liabilities. A gradual upward trend is observed post-2017, with the ratio increasing to 0.54 by 2019. The relatively low quick ratio during this time frame suggests potential challenges in meeting short-term obligations without relying on inventory sales.
- Cash Ratio
- The cash ratio declines notably from 0.70 in 2015 to a low of 0.15 in 2018, indicating a diminished cash and cash equivalents buffer to cover current liabilities. This is followed by a modest improvement to 0.29 in 2019. The consistently low cash ratio over the years signals limited immediate cash availability, necessitating reliance on other quick assets or operational cash flows.
Overall, the liquidity indicators point to a weakening in short-term financial resilience from 2015 to 2017, with gradual improvement afterwards but not to levels exceeding the initial baseline. The trends emphasize a cautious perspective on the company's ability to cover current liabilities, particularly highlighting constraints in the most liquid asset categories.
Current Ratio
Dec 28, 2019 | Dec 29, 2018 | Dec 30, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
---|---|---|---|---|---|---|
Selected Financial Data (US$ in millions) | ||||||
Current assets | ||||||
Current liabilities | ||||||
Liquidity Ratio | ||||||
Current ratio1 | ||||||
Benchmarks | ||||||
Current Ratio, Competitors2 | ||||||
Coca-Cola Co. | ||||||
Mondelēz International Inc. | ||||||
PepsiCo Inc. | ||||||
Philip Morris International Inc. |
Based on: 10-K (reporting date: 2019-12-28), 10-K (reporting date: 2018-12-29), 10-K (reporting date: 2017-12-30), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).
1 2019 Calculation
Current ratio = Current assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Current Assets
- There is a noticeable decline in current assets from 2015 through 2017, dropping from $9,780 million to $7,266 million. However, this trend reverses in 2018 with an increase to $9,075 million, followed by a decline again in 2019 to $8,097 million. Overall, the values show volatility with no consistent upward or downward pattern across the five years.
- Current Liabilities
- Current liabilities show an increasing trend from 2015 to 2017, rising from $6,932 million to $10,132 million. In 2018, liabilities decrease significantly to $7,503 million, before slightly increasing again in 2019 to $7,875 million. The fluctuations suggest periods of increased short-term obligations followed by efforts to reduce them.
- Current Ratio
- The current ratio exhibits considerable variation, starting at 1.41 in 2015, then declining sharply to 0.92 in 2016 and further down to 0.72 in 2017, indicating worsening short-term liquidity. In 2018, liquidity improves significantly, with the ratio rising to 1.21, before slightly decreasing to 1.03 in 2019. The ratio's movement is closely aligned with changes in current assets and liabilities, reflecting shifts in the company’s short-term financial health.
Quick Ratio
Dec 28, 2019 | Dec 29, 2018 | Dec 30, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
---|---|---|---|---|---|---|
Selected Financial Data (US$ in millions) | ||||||
Cash and cash equivalents | ||||||
Trade receivables, net of allowances | ||||||
Sold receivables | ||||||
Total quick assets | ||||||
Current liabilities | ||||||
Liquidity Ratio | ||||||
Quick ratio1 | ||||||
Benchmarks | ||||||
Quick Ratio, Competitors2 | ||||||
Coca-Cola Co. | ||||||
Mondelēz International Inc. | ||||||
PepsiCo Inc. | ||||||
Philip Morris International Inc. |
Based on: 10-K (reporting date: 2019-12-28), 10-K (reporting date: 2018-12-29), 10-K (reporting date: 2017-12-30), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).
1 2019 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Quick assets trend
- The total quick assets showed a significant decline from 2015 to 2017, decreasing from 6291 million USD to 2903 million USD. However, after this period of reduction, the quick assets showed a gradual recovery, rising to 3259 million USD in 2018 and further to 4252 million USD in 2019.
- Current liabilities trend
- The current liabilities increased sharply from 6932 million USD in 2015 to a peak of 10132 million USD in 2017. Subsequently, there was a downward adjustment with current liabilities dropping to 7503 million USD in 2018 and then slightly rising again to 7875 million USD by the end of 2019.
- Quick ratio analysis
- The quick ratio exhibited a declining trend from 0.91 in 2015 to a low point of 0.29 in 2017, indicating a weakening short-term liquidity position during this period. Following 2017, the ratio improved moderately to 0.43 in 2018 and further to 0.54 in 2019. Despite this recovery, the quick ratio in 2019 remained below the 2015 level.
- Overall liquidity insights
- The data reflects a period of liquidity compression between 2015 and 2017, driven by a substantial decrease in quick assets coupled with increasing current liabilities. Post-2017, the company demonstrated partial improvement in liquidity, as indicated by increasing quick assets and an improving quick ratio, though not yet reaching the levels observed at the beginning of the period.
Cash Ratio
Dec 28, 2019 | Dec 29, 2018 | Dec 30, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
---|---|---|---|---|---|---|
Selected Financial Data (US$ in millions) | ||||||
Cash and cash equivalents | ||||||
Total cash assets | ||||||
Current liabilities | ||||||
Liquidity Ratio | ||||||
Cash ratio1 | ||||||
Benchmarks | ||||||
Cash Ratio, Competitors2 | ||||||
Coca-Cola Co. | ||||||
Mondelēz International Inc. | ||||||
PepsiCo Inc. | ||||||
Philip Morris International Inc. |
Based on: 10-K (reporting date: 2019-12-28), 10-K (reporting date: 2018-12-29), 10-K (reporting date: 2017-12-30), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).
1 2019 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Total cash assets
- The total cash assets displayed a declining trend from 2015 to 2018, decreasing from 4,837 million US dollars in 2015 to a low of 1,130 million US dollars in 2018. However, there was a notable recovery in 2019, where the cash assets increased to 2,279 million US dollars, almost doubling the previous year's figure but still remaining below levels observed in 2015 and 2016.
- Current liabilities
- Current liabilities increased significantly between 2015 and 2017, rising from 6,932 million US dollars to a peak of 10,132 million US dollars. In 2018, current liabilities decreased substantially to 7,503 million US dollars but experienced a slight increase again in 2019 to 7,875 million US dollars. Overall, current liabilities remained elevated compared to 2015 over the examined period.
- Cash ratio
- The cash ratio exhibited a decreasing trend beginning at 0.7 in 2015 and dropping sharply to 0.44 in 2016, followed by further decline to a low of 0.15 in 2018. In 2019, the ratio showed improvement by more than 90% from the previous year, reaching 0.29. Despite this increase, the cash ratio in 2019 remained below the level observed in 2015, indicating a generally lower liquidity position relative to current liabilities over the five-year span.
- Summary
- The data reveals a general weakening of liquidity from 2015 to 2018, marked by reduced cash reserves and a declining cash ratio alongside rising current liabilities. In 2019, there were positive movements with an increase in cash assets and a corresponding improvement in the cash ratio, coupled with a moderate reduction in current liabilities compared to the prior peak. Overall, the trend suggests a period of liquidity constraint that partially eased in the final year of the data set.