Analysis of Liquidity Ratios
Quarterly Data
Liquidity ratios measure the company ability to meet its short-term obligations.
Liquidity Ratios (Summary)
Eaton Corp. plc, liquidity ratios (quarterly data)
Based on: 10-Q (reporting date: 2025-09-30), 10-Q (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31).
The analysis of liquidity ratios over the given periods reveals notable fluctuations and evolving trends in the company's short-term financial position.
- Current Ratio
- The current ratio demonstrates an initial decline from 1.51 to a low near 0.97 by mid-2022, suggesting a reduction in the company's ability to cover short-term liabilities with current assets. Subsequently, a recovery phase is observed, with the ratio improving steadily to a peak of approximately 1.56 by mid-2024. This recovery phase indicates strengthening liquidity and improved coverage of short-term obligations. However, in the most recent quarters, the ratio shows a gradual decline again, reaching around 1.24 to 1.28, which may signal emerging liquidity pressures.
- Quick Ratio
- The quick ratio follows a similar trajectory to the current ratio but with lower absolute values, reflecting the exclusion of inventory from liquid assets. It declines initially from 0.66 to roughly 0.50 in mid-2022, indicating a contraction in liquid assets relative to current liabilities. Following this period, the ratio steadily increases, peaking near 0.94 in mid-2024. This illustrates an improvement in readily available assets to cover liabilities. In the latest periods, a modest decline is again observed, falling to approximately 0.63 to 0.65, which points to a slight weakening of the company's immediate liquidity position.
- Cash Ratio
- The cash ratio shows more pronounced volatility with generally lower values, highlighting a limited proportion of cash and cash equivalents relative to current liabilities. It fluctuates between 0.06 and 0.34 over the period, with notable spikes in late 2023 and mid-2024 where it peaks around 0.34. These peaks suggest short intervals of enhanced cash availability. However, the ratio tends to revert to lower levels, and the recent quarters show a decline back to approximately 0.06, indicating reduced cash reserves against liabilities in the most recent periods.
Overall, the data portrays an initial contraction in liquidity ratios until mid-2022 followed by a phase of recovery and improvement through mid-2024. The most recent quarters, however, point to a slight weakening across all liquidity measures. The company appears to have faced some challenges in maintaining steady liquidity, with a particular emphasis on limited cash reserves relative to short-term obligations despite improvements in overall current assets.
Current Ratio
Eaton Corp. plc, current ratio calculation (quarterly data)
| Sep 30, 2025 | Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||
| Current assets | 12,131) | 11,897) | 12,434) | 11,801) | 12,152) | 12,652) | 11,853) | 11,675) | 10,983) | 10,303) | 9,138) | 8,746) | 8,540) | 8,687) | 8,194) | 7,511) | 7,487) | 9,789) | 9,905) | ||||||
| Current liabilities | 9,474) | 9,594) | 9,522) | 7,857) | 7,941) | 8,120) | 7,613) | 7,747) | 7,563) | 6,725) | 6,087) | 6,360) | 6,653) | 8,974) | 8,256) | 7,212) | 5,914) | 8,906) | 6,581) | ||||||
| Liquidity Ratio | |||||||||||||||||||||||||
| Current ratio1 | 1.28 | 1.24 | 1.31 | 1.50 | 1.53 | 1.56 | 1.56 | 1.51 | 1.45 | 1.53 | 1.50 | 1.38 | 1.28 | 0.97 | 0.99 | 1.04 | 1.27 | 1.10 | 1.51 | ||||||
| Benchmarks | |||||||||||||||||||||||||
| Current Ratio, Competitors2 | |||||||||||||||||||||||||
| Boeing Co. | 1.18 | 1.23 | 1.23 | 1.32 | 1.12 | 1.18 | 1.14 | 1.14 | 1.15 | 1.17 | 1.16 | 1.22 | 1.22 | 1.25 | 1.30 | 1.33 | 1.36 | 1.35 | 1.33 | ||||||
| Caterpillar Inc. | 1.38 | 1.34 | 1.32 | 1.42 | 1.40 | 1.28 | 1.35 | 1.35 | 1.45 | 1.33 | 1.43 | 1.39 | 1.41 | 1.45 | 1.44 | 1.46 | 1.61 | 1.56 | 1.60 | ||||||
| GE Aerospace | 1.08 | 1.04 | 1.08 | 1.09 | 1.13 | 1.14 | 1.17 | 1.18 | 1.17 | 1.25 | 1.25 | 1.16 | 1.10 | 1.13 | 1.19 | 1.28 | 1.80 | 1.81 | 1.96 | ||||||
| Honeywell International Inc. | 1.36 | 1.29 | 1.25 | 1.31 | 1.44 | 1.21 | 1.66 | 1.27 | 1.35 | 1.41 | 1.26 | 1.25 | 1.24 | 1.20 | 1.21 | 1.30 | 1.29 | 1.41 | 1.43 | ||||||
| Lockheed Martin Corp. | 1.13 | 0.98 | 1.08 | 1.13 | 1.30 | 1.24 | 1.30 | 1.21 | 1.36 | 1.36 | 1.30 | 1.32 | 1.28 | 1.27 | 1.27 | 1.42 | 1.42 | 1.36 | 1.38 | ||||||
| RTX Corp. | 1.07 | 1.01 | 1.01 | 0.99 | 0.99 | 0.99 | 1.07 | 1.04 | 1.03 | 1.10 | 1.13 | 1.09 | 1.09 | 1.10 | 1.16 | 1.19 | 1.23 | 1.17 | 1.17 | ||||||
Based on: 10-Q (reporting date: 2025-09-30), 10-Q (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31).
1 Q3 2025 Calculation
Current ratio = Current assets ÷ Current liabilities
= 12,131 ÷ 9,474 = 1.28
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals several notable trends in the company's liquidity position over the observed periods.
- Current Assets
- Current assets have generally exhibited an increasing trend from March 31, 2021, through to September 30, 2025. There was an initial decline in the middle of 2021, reaching a low point in September 30, 2021, followed by a steady and consistent growth. This upward momentum continued through to the end of the period, with the highest values recorded during the final quarters, indicating an improvement in the asset base available to meet short-term obligations.
- Current Liabilities
- Current liabilities have shown a relatively fluctuating pattern over the same periods. Initially, there was a peak in June 30, 2021, followed by significant decreases and subsequent fluctuations through to early 2024. From mid-2024 onwards, liabilities generally increased again, reaching notably high levels by mid and late 2025. Such variability suggests changes in short-term obligations possibly related to operational or financing activities.
- Current Ratio
- The current ratio, which measures liquidity by comparing current assets to current liabilities, reflects these movements. Starting at 1.51 in March 2021, the ratio dipped below 1.0 during the first half of 2022, indicating a period where current liabilities exceeded current assets and suggesting potential liquidity stress. Subsequently, the ratio improved significantly, reaching values consistently above 1.4 and peaking at 1.56 in mid-2024. However, in the most recent quarters up to September 2025, the current ratio declined again, falling to a range of approximately 1.24 to 1.31.
Overall, the financial data suggest that the company experienced fluctuations in liquidity throughout the timeline. After a period of relative weakness in liquidity during 2021 and early 2022, the company strengthened its liquidity position substantially throughout 2023 and early 2024. Toward the latter part of the period under review, some weakening in liquidity was observed, which may warrant monitoring to ensure sufficient coverage of short-term liabilities.
Quick Ratio
Eaton Corp. plc, quick ratio calculation (quarterly data)
| Sep 30, 2025 | Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||
| Cash | 328) | 398) | 1,777) | 555) | 473) | 540) | 473) | 488) | 348) | 353) | 235) | 294) | 231) | 364) | 237) | 297) | 271) | 279) | 354) | ||||||
| Short-term investments | 237) | 186) | 162) | 1,525) | 1,521) | 2,241) | 1,969) | 2,121) | 1,558) | 977) | 289) | 261) | 287) | 259) | 268) | 271) | 389) | 261) | 945) | ||||||
| Accounts receivable, net | 5,556) | 5,486) | 5,094) | 4,619) | 4,886) | 4,861) | 4,674) | 4,475) | 4,460) | 4,399) | 4,239) | 4,076) | 3,816) | 3,837) | 3,667) | 3,297) | 3,393) | 3,341) | 3,065) | ||||||
| Total quick assets | 6,121) | 6,070) | 7,033) | 6,699) | 6,880) | 7,642) | 7,116) | 7,084) | 6,366) | 5,729) | 4,763) | 4,631) | 4,334) | 4,460) | 4,172) | 3,865) | 4,053) | 3,881) | 4,364) | ||||||
| Current liabilities | 9,474) | 9,594) | 9,522) | 7,857) | 7,941) | 8,120) | 7,613) | 7,747) | 7,563) | 6,725) | 6,087) | 6,360) | 6,653) | 8,974) | 8,256) | 7,212) | 5,914) | 8,906) | 6,581) | ||||||
| Liquidity Ratio | |||||||||||||||||||||||||
| Quick ratio1 | 0.65 | 0.63 | 0.74 | 0.85 | 0.87 | 0.94 | 0.93 | 0.91 | 0.84 | 0.85 | 0.78 | 0.73 | 0.65 | 0.50 | 0.51 | 0.54 | 0.69 | 0.44 | 0.66 | ||||||
| Benchmarks | |||||||||||||||||||||||||
| Quick Ratio, Competitors2 | |||||||||||||||||||||||||
| Boeing Co. | 0.34 | 0.34 | 0.35 | 0.39 | 0.24 | 0.26 | 0.22 | 0.28 | 0.28 | 0.28 | 0.29 | 0.32 | 0.29 | 0.28 | 0.29 | 0.34 | 0.38 | 0.38 | 0.37 | ||||||
| Caterpillar Inc. | 0.78 | 0.72 | 0.69 | 0.80 | 0.76 | 0.69 | 0.73 | 0.74 | 0.76 | 0.74 | 0.79 | 0.79 | 0.78 | 0.81 | 0.84 | 0.89 | 1.00 | 1.02 | 1.08 | ||||||
| GE Aerospace | 0.73 | 0.70 | 0.74 | 0.78 | 0.81 | 0.81 | 0.76 | 0.78 | 0.76 | 0.84 | 0.86 | 0.81 | 0.73 | 0.75 | 0.82 | 0.93 | 0.90 | 0.90 | 1.06 | ||||||
| Honeywell International Inc. | 0.98 | 0.90 | 0.83 | 0.88 | 0.96 | 0.83 | 1.18 | 0.84 | 0.92 | 0.98 | 0.84 | 0.88 | 0.85 | 0.82 | 0.84 | 0.94 | 0.96 | 1.06 | 1.08 | ||||||
| Lockheed Martin Corp. | 0.93 | 0.80 | 0.87 | 0.92 | 1.10 | 1.05 | 1.08 | 0.99 | 1.14 | 1.14 | 1.07 | 1.09 | 1.06 | 1.03 | 1.03 | 1.15 | 1.18 | 1.10 | 1.09 | ||||||
| RTX Corp. | 0.67 | 0.60 | 0.60 | 0.60 | 0.60 | 0.60 | 0.64 | 0.63 | 0.63 | 0.68 | 0.71 | 0.69 | 0.70 | 0.71 | 0.76 | 0.81 | 0.82 | 0.79 | 0.79 | ||||||
Based on: 10-Q (reporting date: 2025-09-30), 10-Q (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31).
1 Q3 2025 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= 6,121 ÷ 9,474 = 0.65
2 Click competitor name to see calculations.
The analysis of the financial data over multiple quarters reveals important trends in the liquidity position of the company as measured by its total quick assets, current liabilities, and quick ratio.
- Total quick assets
-
Total quick assets demonstrated a fluctuating but generally upward trend from the first quarter of 2021 through the end of 2024. After an initial dip from 4,364 million USD in March 2021 to 3,881 million USD in June 2021, the value rebounded and gradually increased, peaking at 7,642 million USD in the second quarter of 2024. However, by the end of 2024 and early 2025, there was a noticeable decline, falling to approximately 6,070 million USD in the third quarter of 2025 before a slight recovery to 6,121 million USD in the following quarter.
- Current liabilities
-
Current liabilities showed significant volatility over the examined period. Starting at 6,581 million USD in March 2021, liabilities increased sharply to 8,906 million USD by June 2021, then decreased to 5,914 million USD by September 2021. Subsequently, liabilities followed an irregular pattern with multiple rises and falls, peaking again at 9,594 million USD in June 2025. This fluctuation suggests periods of varying short-term obligations, which may be linked to operational or financial strategy adjustments.
- Quick ratio
-
The quick ratio, an indicator of short-term liquidity, began at 0.66 in the first quarter of 2021 and experienced a decline to as low as 0.44 by mid-2021, indicating a reduction in immediate liquidity relative to liabilities. Following this trough, the ratio steadily improved, reaching a high of 0.94 by the second quarter of 2024, which points to a strengthened capacity to cover current liabilities with liquid assets. Post this peak, the ratio declined gradually to about 0.63–0.65 by the third quarter of 2025, suggesting a moderation in liquidity cover, but still above the lower levels observed in 2021.
In summary, the company's liquidity exhibited cyclical fluctuations with an overall improvement trend in quick assets and the quick ratio until mid-2024, after which there was a minor retrenchment. Current liabilities showed pronounced variability that influenced the quick ratio's movements. The quick ratio's peak close to 1 indicates periods of strong liquidity, while its dips underscore the need for continued attention to short-term financial stability.
Cash Ratio
Eaton Corp. plc, cash ratio calculation (quarterly data)
| Sep 30, 2025 | Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||
| Cash | 328) | 398) | 1,777) | 555) | 473) | 540) | 473) | 488) | 348) | 353) | 235) | 294) | 231) | 364) | 237) | 297) | 271) | 279) | 354) | ||||||
| Short-term investments | 237) | 186) | 162) | 1,525) | 1,521) | 2,241) | 1,969) | 2,121) | 1,558) | 977) | 289) | 261) | 287) | 259) | 268) | 271) | 389) | 261) | 945) | ||||||
| Total cash assets | 565) | 584) | 1,939) | 2,080) | 1,994) | 2,781) | 2,442) | 2,609) | 1,906) | 1,330) | 524) | 555) | 518) | 623) | 505) | 568) | 660) | 540) | 1,299) | ||||||
| Current liabilities | 9,474) | 9,594) | 9,522) | 7,857) | 7,941) | 8,120) | 7,613) | 7,747) | 7,563) | 6,725) | 6,087) | 6,360) | 6,653) | 8,974) | 8,256) | 7,212) | 5,914) | 8,906) | 6,581) | ||||||
| Liquidity Ratio | |||||||||||||||||||||||||
| Cash ratio1 | 0.06 | 0.06 | 0.20 | 0.26 | 0.25 | 0.34 | 0.32 | 0.34 | 0.25 | 0.20 | 0.09 | 0.09 | 0.08 | 0.07 | 0.06 | 0.08 | 0.11 | 0.06 | 0.20 | ||||||
| Benchmarks | |||||||||||||||||||||||||
| Cash Ratio, Competitors2 | |||||||||||||||||||||||||
| Boeing Co. | 0.22 | 0.22 | 0.23 | 0.27 | 0.11 | 0.13 | 0.08 | 0.17 | 0.14 | 0.15 | 0.16 | 0.19 | 0.16 | 0.14 | 0.15 | 0.20 | 0.23 | 0.24 | 0.24 | ||||||
| Caterpillar Inc. | 0.21 | 0.16 | 0.11 | 0.21 | 0.17 | 0.13 | 0.15 | 0.20 | 0.20 | 0.21 | 0.21 | 0.22 | 0.21 | 0.21 | 0.22 | 0.31 | 0.36 | 0.39 | 0.43 | ||||||
| GE Aerospace | 0.36 | 0.33 | 0.38 | 0.42 | 0.47 | 0.47 | 0.43 | 0.45 | 0.42 | 0.49 | 0.52 | 0.44 | 0.35 | 0.37 | 0.44 | 0.54 | 0.52 | 0.50 | 0.67 | ||||||
| Honeywell International Inc. | 0.59 | 0.49 | 0.46 | 0.52 | 0.56 | 0.47 | 0.73 | 0.44 | 0.46 | 0.51 | 0.40 | 0.51 | 0.44 | 0.43 | 0.49 | 0.59 | 0.60 | 0.68 | 0.71 | ||||||
| Lockheed Martin Corp. | 0.15 | 0.05 | 0.09 | 0.13 | 0.18 | 0.14 | 0.16 | 0.09 | 0.21 | 0.21 | 0.14 | 0.16 | 0.15 | 0.11 | 0.12 | 0.26 | 0.18 | 0.18 | 0.20 | ||||||
| RTX Corp. | 0.11 | 0.09 | 0.10 | 0.11 | 0.13 | 0.12 | 0.12 | 0.14 | 0.12 | 0.13 | 0.15 | 0.16 | 0.14 | 0.13 | 0.17 | 0.22 | 0.22 | 0.23 | 0.24 | ||||||
Based on: 10-Q (reporting date: 2025-09-30), 10-Q (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31).
1 Q3 2025 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= 565 ÷ 9,474 = 0.06
2 Click competitor name to see calculations.
The financial data reveals notable fluctuations in the cash assets, current liabilities, and cash ratio over the examined periods.
- Total cash assets
- The total cash assets display significant volatility throughout the periods. Initially high at the beginning of 2021, cash assets dropped sharply by mid-2021, then maintained relatively moderate values for several quarters. From early 2023, a marked increase occurred, peaking by the fourth quarter of 2023. Subsequently, cash assets declined again in 2025, reaching some of the lowest levels observed in the data.
- Current liabilities
- Current liabilities show a generally increasing trend with some variability. There were initial fluctuations in 2021 and 2022, including a spike around mid-2022 followed by a decrease at year-end 2022. In 2023, liabilities began rising steadily, peaking in the mid to latter quarters of 2025. Overall, current liabilities increased from approximately 6,500 million to over 9,500 million US dollars over the period.
- Cash ratio
- The cash ratio demonstrates significant instability through the examined quarters. The initial values were low, with a decline observed in the first half of 2021. Thereafter, the ratio gradually improved, with a notable increase during 2023, reaching values above 0.3 at the end of that year and into mid-2024. Towards 2025, the ratio declined sharply again, mirroring the reduction in cash assets and the rise in liabilities.
In summary, the data shows a pattern of considerable volatility in liquidity positions, with cash assets and cash ratio experiencing substantial fluctuations that suggest periodic changes in short-term financial stability. Meanwhile, current liabilities have followed a general upward trend, which could potentially exert pressure on liquidity unless managed by corresponding increases in cash or other liquid resources. The variations in the cash ratio indicate that the company’s immediate capacity to cover current liabilities with cash has been inconsistent, warranting attention to liquidity management strategies going forward.