Bristol-Myers Squibb Co. (NYSE:BMY)

The liquidity position of the company exhibits a generally declining trend from 2021 through 2025, although some stabilization is apparent in the most recent periods. All three liquidity ratios – current, quick, and cash – demonstrate decreases over the five-year period, suggesting a reduced ability to meet short-term obligations using readily available assets. However, the rate of decline appears to moderate in 2024 and 2025.

Current Ratio

The current ratio decreased from 1.52 in 2021 to 1.26 in 2025. A notable drop occurred between 2021 and 2022, falling to 1.25, followed by a slight recovery to 1.43 in 2023. The ratio then decreased again to 1.25 in 2024 and remained stable at 1.26 in 2025. This indicates a diminishing cushion of current assets to cover current liabilities, but the recent stabilization suggests the decline may be slowing.

Quick Ratio

The quick ratio experienced a more substantial decline than the current ratio, moving from 1.20 in 2021 to 0.94 in 2025. The largest decrease was observed between 2021 and 2022, falling to 0.87. A modest recovery to 1.04 occurred in 2023, but the ratio subsequently decreased to 0.91 in 2024 and 0.94 in 2025. This suggests a weakening ability to meet short-term obligations with the most liquid assets, excluding inventory.

Cash Ratio

The cash ratio demonstrated the most significant decrease, declining from 0.78 in 2021 to 0.46 in both 2024 and 2025. A substantial drop occurred between 2021 and 2022, reaching 0.42. The ratio saw a slight increase to 0.55 in 2023 before stabilizing at 0.46 for the final two years. This indicates a reduced capacity to cover immediate liabilities with cash and cash equivalents.

Overall, the consistent decline in all three liquidity ratios suggests a potential increase in liquidity risk over the period. While the stabilization in 2024 and 2025 is a positive sign, continued monitoring of these ratios is warranted to assess whether the trend has truly reversed.

The current ratio exhibited fluctuations over the five-year period. Initially, the ratio decreased before stabilizing in the latter years of the observed timeframe. A review of the underlying components, current assets and current liabilities, provides further context for these movements.

Current Ratio Trend

The current ratio began at 1.52 in 2021, indicating the company possessed $1.52 of current assets for every $1.00 of current liabilities. A decline was observed in 2022, with the ratio falling to 1.25. The ratio then increased to 1.43 in 2023, but subsequently decreased again to 1.25 in 2024. The ratio showed a slight increase in 2025, reaching 1.26.

Current Assets

Current assets decreased from $33,262 million in 2021 to $27,273 million in 2022. A recovery was noted in 2023, with current assets rising to $31,770 million. However, a slight decrease occurred in both 2024 ($29,780 million) and 2025 ($29,390 million).

Current Liabilities

Current liabilities remained relatively stable between 2021 and 2023, fluctuating around $21.9 billion. An increase was observed in 2024, reaching $23,774 million, followed by a slight decrease to $23,417 million in 2025.

The initial decline in the current ratio from 2021 to 2022 was primarily driven by a more substantial decrease in current assets compared to the relatively stable current liabilities. The subsequent increase in 2023 coincided with an increase in current assets. The ratio’s decline in 2024 appears to be attributable to a larger increase in current liabilities, while the slight increase in 2025 reflects a smaller increase in liabilities compared to the prior year.

The current ratio remained above 1.0 for the entire period, suggesting the company generally maintained sufficient current assets to cover its current liabilities. However, the fluctuations indicate potential shifts in the company’s short-term financial position and warrant further investigation into the composition of current assets and liabilities.

The quick ratio exhibited fluctuations over the five-year period. Initially, the ratio decreased significantly before stabilizing and showing a slight upward trend in the latter years. A review of the underlying components reveals the drivers of these changes.

Quick Ratio Trend

The quick ratio began at 1.20 in 2021, indicating a healthy ability to meet short-term obligations with highly liquid assets. A substantial decline was observed in 2022, with the ratio falling to 0.87. This suggests a diminished capacity to cover immediate liabilities without relying on inventory sales. The ratio partially recovered to 1.04 in 2023, but subsequently decreased to 0.91 in 2024. A modest increase to 0.94 was noted in 2025, signaling a slight improvement but remaining below the initial level.

Total Quick Assets

Total quick assets decreased from US$26,335 million in 2021 to US$19,139 million in 2022, contributing to the initial drop in the quick ratio. A recovery to US$23,201 million occurred in 2023, followed by a decrease to US$21,606 million in 2024. The final year saw a slight increase to US$22,087 million. These fluctuations in quick assets influenced the overall liquidity position.

Current Liabilities

Current liabilities remained relatively stable between 2021 and 2023, fluctuating around US$21,868 million to US$22,262 million. An increase to US$23,774 million was observed in 2024, which, combined with the decrease in quick assets, further contributed to the decline in the quick ratio during that year. Current liabilities decreased slightly to US$23,417 million in 2025.

The interplay between quick assets and current liabilities demonstrates a dynamic liquidity profile. While the quick ratio stabilized towards the end of the period, it did not return to the level observed in 2021. Continued monitoring of these components is recommended to assess any potential risks to short-term solvency.

The cash ratio exhibited fluctuations over the five-year period. Initially, the ratio decreased significantly before stabilizing in the latter years of the observed timeframe. This suggests a changing ability to meet current obligations with only the most liquid assets.

Cash Ratio Trend

The cash ratio began at 0.78 in 2021, indicating that the company held 78 cents of cash for every dollar of current liabilities. A substantial decline was observed in 2022, with the ratio falling to 0.42. This represents a significant reduction in the company’s immediate liquidity position. The ratio partially recovered to 0.55 in 2023, but then decreased again to 0.46 in 2024 and remained constant at 0.46 in 2025.

Total Cash Assets

Total cash assets decreased from US$16,966 million in 2021 to US$9,253 million in 2022. A subsequent increase to US$12,280 million was noted in 2023, followed by a decrease to US$10,859 million in 2024 and a further slight decrease to US$10,673 million in 2025. The fluctuations in cash assets appear to correlate with the changes in the cash ratio, though not perfectly.

Current Liabilities

Current liabilities remained relatively stable between 2021 and 2023, fluctuating around US$21,868 to US$22,262 million. An increase was observed in 2024, reaching US$23,774 million, followed by a slight decrease to US$23,417 million in 2025. The increase in current liabilities, coupled with the initial decrease in cash assets, contributed to the significant drop in the cash ratio in 2022.

The stabilization of the cash ratio at 0.46 in the final two years suggests a consistent, albeit reduced, capacity to cover short-term obligations with available cash. Continued monitoring of both cash asset levels and current liabilities is warranted to assess any potential risks to short-term liquidity.