Liquidity ratios measure the company ability to meet its short-term obligations.
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- Statement of Comprehensive Income
- Common-Size Balance Sheet: Assets
- Analysis of Profitability Ratios
- Enterprise Value (EV)
- Enterprise Value to FCFF (EV/FCFF)
- Price to FCFE (P/FCFE)
- Net Profit Margin since 2005
- Price to Book Value (P/BV) since 2005
- Price to Sales (P/S) since 2005
- Analysis of Revenues
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Liquidity Ratios (Summary)
Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
---|---|---|---|---|---|---|
Current ratio | ||||||
Quick ratio | ||||||
Cash ratio |
Based on: 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), 10-K (reporting date: 2019-12-31).
- Current Ratio
- The current ratio exhibited fluctuations over the five-year period. Starting at 0.59 in 2019, it increased to 0.79 in 2020, followed by a decline to 0.71 in 2021. In 2022, it rose again to 0.84 before sharply decreasing to 0.49 in 2023. Overall, the trend shows variability with a notable drop in the final year, suggesting a reduction in the company's short-term liquidity position by the end of 2023.
- Quick Ratio
- The quick ratio mirrored the pattern observed in the current ratio, albeit at generally lower levels. It increased from 0.28 in 2019 to a peak of 0.56 in 2020, then slightly declined to 0.54 in 2021. This ratio improved again to 0.67 in 2022 but dropped to 0.33 in 2023. The pattern indicates some volatility and a weakening liquidity position in the most recent year, reflecting decreased availability of liquid assets to cover short-term liabilities.
- Cash Ratio
- The cash ratio showed an upward movement from 0.26 in 2019 to 0.55 in 2020, maintaining a similar level of 0.53 in 2021. It then declined to 0.47 in 2022 and further decreased to 0.33 in 2023. This downward trend in the last two years indicates a reduction in the company's cash and cash equivalents relative to its current liabilities, potentially signaling tighter cash reserves available for immediate obligations.
- Overall Liquidity Analysis
- Across all three liquidity ratios, there is a common pattern of initial improvement from 2019 through 2020, with ratios generally peaking or reaching higher values in 2020 or 2022. However, from 2022 to 2023, all ratios show a significant decline, suggesting a deterioration in liquidity and a potential increase in financial risk. The most recent data points to a less favorable short-term financial position, with diminished capacity to cover current liabilities using available assets.
Current Ratio
Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
---|---|---|---|---|---|---|
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. | ||||||
Current Ratio, Sector | ||||||
Food, Beverage & Tobacco | ||||||
Current Ratio, Industry | ||||||
Consumer Staples |
Based on: 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), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Current ratio = Current assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
The financial data reveals notable fluctuations in current assets, current liabilities, and the current ratio over the five-year period from 2019 to 2023.
- Current Assets
- Current assets showed an overall upward trend from 2019 (US$4,824 million) to 2020 (US$7,117 million), followed by a decline in 2021 (US$6,083 million). The figure rebounded in 2022, reaching US$7,220 million, but then decreased significantly in 2023 to US$5,585 million. This pattern indicates variability in liquidity resources held by the company over the years, with a peak in 2022 and a notable reduction the following year.
- Current Liabilities
- Current liabilities increased steadily from 2019 (US$8,174 million) through to 2020 (US$9,063 million) and showed minor fluctuations in 2021 (US$8,579 million) and 2022 (US$8,616 million). In 2023, however, there was a sharp increase to US$11,319 million, representing the highest level in the period analyzed. This upward trend, particularly the substantial rise in 2023, suggests growing short-term obligations.
- Current Ratio
- The current ratio improved progressively from 0.59 in 2019 to 0.79 in 2020, indicating strengthening liquidity. After a slight decline to 0.71 in 2021, it rose again to 0.84 in 2022, reaching the highest point recorded in the data. Nevertheless, in 2023, the current ratio dropped sharply to 0.49, signaling potential liquidity concerns as current liabilities increased substantially while current assets decreased.
In summary, while the company exhibited fluctuations in current assets and liabilities over the five years, the marked increase in current liabilities alongside a decrease in current assets in 2023 led to a significant decline in the current ratio. This change may warrant attention to short-term liquidity management and the ability to meet imminent obligations.
Quick Ratio
Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
---|---|---|---|---|---|---|
Selected Financial Data (US$ in millions) | ||||||
Cash and cash equivalents | ||||||
Receivable from the sale of IQOS System commercialization rights | ||||||
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. | ||||||
Quick Ratio, Sector | ||||||
Food, Beverage & Tobacco | ||||||
Quick Ratio, Industry | ||||||
Consumer Staples |
Based on: 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), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Total quick assets
- The total quick assets exhibited fluctuations over the five-year period. Starting at 2,269 million USD in 2019, there was a notable increase to 5,082 million USD in 2020. This was followed by a slight decline to 4,591 million USD in 2021, then a rise again to 5,799 million USD in 2022. However, in 2023, the quick assets decreased significantly to 3,757 million USD.
- Current liabilities
- Current liabilities showed a general increasing trend throughout the period. Beginning at 8,174 million USD in 2019, liabilities rose steadily each year, reaching 9,063 million USD in 2020, then slightly decreasing to 8,579 million USD in 2021. From 2021 onwards, liabilities increased again to 8,616 million USD in 2022 and sharply rose to 11,319 million USD in 2023, marking the highest point during the time frame.
- Quick ratio
- The quick ratio, an indicator of short-term liquidity, revealed varying performance. It started very low at 0.28 in 2019, then improved significantly to 0.56 in 2020. This slight decline to 0.54 occurred in 2021, followed by the highest ratio at 0.67 in 2022, suggesting improved liquidity. However, this was not sustained, as the ratio sharply fell to 0.33 in 2023, indicating reduced ability to cover current liabilities with quick assets.
- Overall assessment
- Overall, the data indicates volatile liquidity and asset levels over the five years. Although quick assets peaked twice, the sharp decrease in 2023 combined with the substantial rise in current liabilities contributed to a marked decline in the quick ratio that year. This reflects increased liquidity risk towards the end of the period and may warrant closer attention to short-term financial management and asset allocation strategies.
Cash Ratio
Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
---|---|---|---|---|---|---|
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. | ||||||
Cash Ratio, Sector | ||||||
Food, Beverage & Tobacco | ||||||
Cash Ratio, Industry | ||||||
Consumer Staples |
Based on: 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), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Total Cash Assets
- The total cash assets exhibited a significant increase from 2019 to 2020, more than doubling from approximately 2.1 billion USD to nearly 5 billion USD. Following this peak, there was a gradual decline over the next three years, with total cash assets decreasing to about 3.7 billion USD by the end of 2023. This trend suggests that after accumulating a substantial cash reserve in 2020, the company gradually utilized some of the cash holdings over the subsequent period.
- Current Liabilities
- Current liabilities showed a general upward trend throughout the observed period. Starting at around 8.2 billion USD in 2019, they increased to over 9 billion USD by 2020, followed by a slight decline in 2021 before rising again to reach approximately 11.3 billion USD by the end of 2023. This indicates growing short-term obligations, with a notable surge in the latest year under review.
- Cash Ratio
- The cash ratio, representing the company's liquidity position relative to its current liabilities, mirrored the changes in cash assets and liabilities. It rose sharply from 0.26 in 2019 to 0.55 in 2020, indicating improved liquidity. However, the ratio declined steadily thereafter, falling to 0.33 in 2023. This decline reflects both the reduction in cash assets and the increase in current liabilities, suggesting a weakening liquidity position over the last three years.