Analysis of Liquidity Ratios
Liquidity ratios measure the company ability to meet its short-term obligations.
Paying user area
Try for free
Tesla Inc. pages available for free this week:
- Analysis of Profitability Ratios
- Analysis of Long-term (Investment) Activity Ratios
- Common Stock Valuation Ratios
- Enterprise Value (EV)
- Price to FCFE (P/FCFE)
- Present Value of Free Cash Flow to Equity (FCFE)
- Net Profit Margin since 2010
- Operating Profit Margin since 2010
- Price to Earnings (P/E) since 2010
- Price to Operating Profit (P/OP) since 2010
The data is hidden behind: . Unhide it.
Get full access to the entire website from $10.42/mo, or
get 1-month access to Tesla Inc. for $24.99.
This is a one-time payment. There is no automatic renewal.
We accept:
Liquidity Ratios (Summary)
Tesla Inc., liquidity ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Current ratio | ||||||
| Quick ratio | ||||||
| Cash ratio |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
The analysis of the liquidity ratios over the five-year span reveals distinct trends in the company's short-term financial health.
- Current Ratio
- The current ratio exhibits a decline from 1.88 in 2020 to a low of 1.38 in 2021, indicating a decrease in the company's ability to cover its short-term liabilities with its short-term assets during this period. However, from 2021 onwards, the ratio shows a consistent upward trajectory, rising to 2.02 by the end of 2024. This improvement suggests enhancing liquidity and a stronger position to meet obligations as they come due.
- Quick Ratio
- The quick ratio follows a somewhat similar pattern. It starts at 1.49 in 2020, drops significantly to 1.00 in 2021, and then declines slightly further to 0.94 in 2022. Beginning in 2023, there is a recovery, with the ratio increasing to 1.13 and subsequently to 1.42 in 2024. This pattern indicates an initial reduction in liquid assets relative to current liabilities, followed by a gradual improvement, suggesting better quality of current assets excluding inventory.
- Cash Ratio
- The cash ratio also trends downward initially, moving from 1.36 in 2020 to 0.90 in 2021 and further declining to 0.83 in 2022. From 2023 onwards, it shows a recovery, rising to 1.01 and then to 1.27 in 2024. This reflects a similar narrative where cash and cash equivalents decreased relative to current liabilities but improved in the latter years, indicating strengthening immediate liquidity.
In summary, all three liquidity ratios suggest that the company's liquidity position weakened from 2020 through 2022, which may have indicated increased risk in covering short-term liabilities during that period. However, the subsequent recovery and consistent increase in these ratios from 2023 to 2024 demonstrate a positive trend toward improved liquidity and potentially more conservative or effective asset management strategies. The return of these ratios to levels above those observed in 2020 suggests a stronger financial cushion and enhanced financial flexibility at the end of the observed period.
Current Ratio
Tesla Inc., current ratio calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Current assets | ||||||
| Current liabilities | ||||||
| Liquidity Ratio | ||||||
| Current ratio1 | ||||||
| Benchmarks | ||||||
| Current Ratio, Competitors2 | ||||||
| Ford Motor Co. | ||||||
| General Motors Co. | ||||||
| Current Ratio, Sector | ||||||
| Automobiles & Components | ||||||
| Current Ratio, Industry | ||||||
| Consumer Discretionary | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Current ratio = Current assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Current Assets
- Current assets exhibit a consistent upward trend over the observed period. Starting at 26,717 million US dollars at the end of 2020, they increased moderately to 27,100 million in 2021, then saw a substantial rise to 40,917 million in 2022. This growth accelerated in subsequent years, reaching 49,616 million in 2023 and further to 58,360 million by the end of 2024. The pattern reflects a strengthening liquidity position with a continuous accumulation of liquid and short-term assets.
- Current Liabilities
- Current liabilities also show an increasing trend during the period. The values rose from 14,248 million US dollars in 2020 to 19,705 million in 2021, demonstrating a significant increase. The upward trajectory continued with a steeper rise to 26,709 million in 2022, followed by a slower increase to 28,748 million in 2023 and stabilizing at 28,821 million in 2024. This suggests an expanding short-term obligation profile, albeit with a deceleration in growth rate toward the end of the period.
- Current Ratio
- The current ratio reveals fluctuations but an overall improvement in short-term liquidity. Initially high at 1.88 in 2020, the ratio fell to 1.38 in 2021, indicating a temporary reduction in liquidity coverage of current liabilities by current assets. The ratio improved to 1.53 in 2022 and strengthened further to 1.73 in 2023. By 2024, it reached 2.02, the highest within the observed timeframe, signaling a robust capacity to meet short-term obligations and suggesting prudent working capital management.
Quick Ratio
Tesla Inc., quick ratio calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Cash and cash equivalents | ||||||
| Short-term investments | ||||||
| Accounts receivable, net | ||||||
| Total quick assets | ||||||
| Current liabilities | ||||||
| Liquidity Ratio | ||||||
| Quick ratio1 | ||||||
| Benchmarks | ||||||
| Quick Ratio, Competitors2 | ||||||
| Ford Motor Co. | ||||||
| General Motors Co. | ||||||
| Quick Ratio, Sector | ||||||
| Automobiles & Components | ||||||
| Quick Ratio, Industry | ||||||
| Consumer Discretionary | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Total quick assets
- The total quick assets exhibit a consistent upward trend over the five-year period. Starting at $21,270 million in 2020, the value slightly decreases in 2021 to $19,620 million but then increases substantially in subsequent years, reaching $40,981 million by the end of 2024. This represents a significant growth in liquid assets that can be quickly converted to cash without affecting inventory.
- Current liabilities
- Current liabilities show a marked increase between 2020 and 2022, rising from $14,248 million to $26,709 million. After 2022, the growth rate slows considerably, with figures stabilizing around $28,800 million by 2024. This indicates increasing short-term obligations, with a plateauing trend in the last two years.
- Quick ratio
- The quick ratio, which measures liquidity by dividing quick assets by current liabilities, declines from 1.49 in 2020 to a low of 0.94 in 2022, reflecting tighter liquidity during that period. Afterwards, the ratio improves to 1.13 in 2023 and further to 1.42 in 2024, suggesting an enhanced ability to cover short-term liabilities with liquid assets towards the end of the time frame.
- Overall insights
- The initial decrease in quick assets and the concurrent rise in current liabilities between 2020 and 2022 results in a declining quick ratio, which may signal increasing liquidity risk in that timeframe. However, the subsequent recovery and growth in quick assets outpacing the stabilization of current liabilities lead to a stronger liquidity position by 2024. This overall pattern reflects a cycle of tightening liquidity followed by strategic improvements to bolster financial stability.
Cash Ratio
Tesla Inc., cash ratio calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Cash and cash equivalents | ||||||
| Short-term investments | ||||||
| Total cash assets | ||||||
| Current liabilities | ||||||
| Liquidity Ratio | ||||||
| Cash ratio1 | ||||||
| Benchmarks | ||||||
| Cash Ratio, Competitors2 | ||||||
| Ford Motor Co. | ||||||
| General Motors Co. | ||||||
| Cash Ratio, Sector | ||||||
| Automobiles & Components | ||||||
| Cash Ratio, Industry | ||||||
| Consumer Discretionary | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
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 an overall increasing trend throughout the period. Starting at 19,384 million USD in 2020, there was a decline to 17,707 million USD in 2021. Subsequently, the value rose consistently, reaching 22,185 million USD in 2022, 29,094 million USD in 2023, and finally peaking at 36,563 million USD in 2024. This indicates enhanced liquidity and stronger cash reserves over recent years following the initial dip.
- Current Liabilities
- Current liabilities showed a significant and steady increase from 14,248 million USD in 2020 to 28,821 million USD in 2024. The rise was consistent year-over-year, more than doubling in size over the five-year span. This trend reflects growing short-term obligations, which may suggest increased operational scale or financing activities.
- Cash Ratio
- The cash ratio initially declined from 1.36 in 2020 to a low of 0.83 in 2022, indicating reduced immediate liquidity relative to current liabilities during this period. However, improvements were observed afterward, with the ratio increasing to 1.01 in 2023 and further to 1.27 in 2024. By the end of the period, the company had restored a strong liquidity position, with cash assets exceeding current liabilities by a notable margin.