Microsoft Excel LibreOffice Calc

T-Mobile US Inc. (NASDAQ:TMUS)

Analysis of Liquidity Ratios

Beginner level

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

Liquidity Ratios (Summary)

T-Mobile US Inc., liquidity ratios

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Current ratio 0.74 0.81 0.77 1.58 1.56
Quick ratio 0.48 0.54 0.47 1.04 1.24
Cash ratio 0.12 0.12 0.11 0.61 0.80

Based on: 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-07), 10-K (filing date: 2018-02-08), 10-K (filing date: 2017-02-14), 10-K (filing date: 2016-02-17).

Liquidity ratio Description The company
Current ratio A liquidity ratio calculated as current assets divided by current liabilities. T-Mobile US Inc.’s current ratio improved from 2017 to 2018 but then deteriorated significantly from 2018 to 2019.
Quick ratio A liquidity ratio calculated as (cash plus short-term marketable investments plus receivables) divided by current liabilities. T-Mobile US Inc.’s quick ratio improved from 2017 to 2018 but then slightly deteriorated from 2018 to 2019 not reaching 2017 level.
Cash ratio A liquidity ratio calculated as (cash plus short-term marketable investments) divided by current liabilities. T-Mobile US Inc.’s cash ratio improved from 2017 to 2018 and from 2018 to 2019.

Current Ratio

T-Mobile US Inc., current ratio calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Selected Financial Data (US$ in millions)
Current assets 9,305  8,281  8,915  14,217  14,890 
Current liabilities 12,506  10,267  11,515  9,022  9,528 
Liquidity Ratio
Current ratio1 0.74 0.81 0.77 1.58 1.56
Benchmarks
Current Ratio, Industry
Telecommunications 0.80 0.84 0.94 0.88 0.79

Based on: 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-07), 10-K (filing date: 2018-02-08), 10-K (filing date: 2017-02-14), 10-K (filing date: 2016-02-17).

1 2019 Calculation
Current ratio = Current assets ÷ Current liabilities
= 9,305 ÷ 12,506 = 0.74

Liquidity ratio Description The company
Current ratio A liquidity ratio calculated as current assets divided by current liabilities. T-Mobile US Inc.’s current ratio improved from 2017 to 2018 but then deteriorated significantly from 2018 to 2019.

Quick Ratio

T-Mobile US Inc., quick ratio calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Selected Financial Data (US$ in millions)
Cash and cash equivalents 1,528  1,203  1,219  5,500  4,582 
Short-term investments —  —  —  —  2,998 
Accounts receivable, net of allowances 1,888  1,769  1,915  1,896  1,788 
Equipment installment plan receivables, net 2,600  2,538  2,290  1,930  2,378 
Accounts receivable from affiliates 20  11  22  40  36 
Total quick assets 6,036  5,521  5,446  9,366  11,782 
 
Current liabilities 12,506  10,267  11,515  9,022  9,528 
Liquidity Ratio
Quick ratio1 0.48 0.54 0.47 1.04 1.24
Benchmarks
Quick Ratio, Industry
Telecommunications 0.54 0.58 0.78 0.58 0.56

Based on: 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-07), 10-K (filing date: 2018-02-08), 10-K (filing date: 2017-02-14), 10-K (filing date: 2016-02-17).

1 2019 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= 6,036 ÷ 12,506 = 0.48

Liquidity ratio Description The company
Quick ratio A liquidity ratio calculated as (cash plus short-term marketable investments plus receivables) divided by current liabilities. T-Mobile US Inc.’s quick ratio improved from 2017 to 2018 but then slightly deteriorated from 2018 to 2019 not reaching 2017 level.

Cash Ratio

T-Mobile US Inc., cash ratio calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Selected Financial Data (US$ in millions)
Cash and cash equivalents 1,528  1,203  1,219  5,500  4,582 
Short-term investments —  —  —  —  2,998 
Total cash assets 1,528  1,203  1,219  5,500  7,580 
 
Current liabilities 12,506  10,267  11,515  9,022  9,528 
Liquidity Ratio
Cash ratio1 0.12 0.12 0.11 0.61 0.80
Benchmarks
Cash Ratio, Industry
Telecommunications 0.13 0.08 0.43 0.16 0.19

Based on: 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-07), 10-K (filing date: 2018-02-08), 10-K (filing date: 2017-02-14), 10-K (filing date: 2016-02-17).

1 2019 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= 1,528 ÷ 12,506 = 0.12

Liquidity ratio Description The company
Cash ratio A liquidity ratio calculated as (cash plus short-term marketable investments) divided by current liabilities. T-Mobile US Inc.’s cash ratio improved from 2017 to 2018 and from 2018 to 2019.