Current Ratio
since 2005
Calculation
Emerson Electric Co., current ratio, long-term trends, calculation
| Current ratio | = | Current assets1 | ÷ | Current liabilities1 | |
|---|---|---|---|---|---|
| Sep 30, 2019 | 1.19 | = | 7,139) | ÷ | 5,976) |
| Sep 30, 2018 | 1.07 | = | 6,619) | ÷ | 6,164) |
| Sep 30, 2017 | 1.64 | = | 8,252) | ÷ | 5,045) |
| Sep 30, 2016 | 1.24 | = | 9,960) | ÷ | 8,008) |
| Sep 30, 2015 | 1.29 | = | 10,049) | ÷ | 7,800) |
| Sep 30, 2014 | 1.29 | = | 10,867) | ÷ | 8,454) |
| Sep 30, 2013 | 1.44 | = | 10,999) | ÷ | 7,625) |
| Sep 30, 2012 | 1.42 | = | 10,126) | ÷ | 7,133) |
| Sep 30, 2011 | 1.45 | = | 9,345) | ÷ | 6,465) |
| Sep 30, 2010 | 1.43 | = | 8,363) | ÷ | 5,849) |
| Sep 30, 2009 | 1.54 | = | 7,653) | ÷ | 4,956) |
| Sep 30, 2008 | 1.42 | = | 9,331) | ÷ | 6,573) |
| Sep 30, 2007 | 1.45 | = | 8,065) | ÷ | 5,546) |
| Sep 30, 2006 | 1.36 | = | 7,330) | ÷ | 5,374) |
| Sep 30, 2005 | 1.39 | = | 6,837) | ÷ | 4,931) |
Based on: 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30), 10-K (reporting date: 2017-09-30), 10-K (reporting date: 2016-09-30), 10-K (reporting date: 2015-09-30), 10-K (reporting date: 2014-09-30), 10-K (reporting date: 2013-09-30), 10-K (reporting date: 2012-09-30), 10-K (reporting date: 2011-09-30), 10-K (reporting date: 2010-09-30), 10-K (reporting date: 2009-09-30), 10-K (reporting date: 2008-09-30), 10-K (reporting date: 2007-09-30), 10-K (reporting date: 2006-09-30), 10-K (reporting date: 2005-09-30).
1 US$ in millions
The liquidity position of the company from 2005 to 2019 is characterized by an initial period of stability followed by increased volatility in the final five years. The current ratio remained consistently above 1.0 throughout the entire period, indicating that current assets were sufficient to cover current liabilities, although the margin of safety fluctuated significantly.
- Long-term Current Ratio Trends
- Between 2005 and 2013, the current ratio exhibited relative stability, generally fluctuating within a narrow range between 1.36 and 1.54. A peak liquidity ratio of 1.54 was observed in 2009, while a gradual softening began in 2014, with the ratio dipping to 1.24 by 2016.
- Working Capital Volatility (2017–2019)
- A significant deviation occurred in 2017, where the current ratio spiked to 1.64, the highest point in the analyzed period. This was driven by a substantial reduction in current liabilities, which fell from 8,008 million US$ in 2016 to 5,045 million US$ in 2017. This peak was immediately followed by a sharp decline in 2018, where the current ratio reached its period low of 1.07, coinciding with a drop in current assets to 6,619 million US$. A slight recovery to 1.19 was noted in 2019.
- Asset and Liability Correlation
- Current assets grew steadily from 6,837 million US$ in 2005 to a peak of 10,999 million US$ in 2013. Current liabilities followed a similar upward trajectory, peaking slightly later in 2014 at 8,454 million US$. The subsequent decline in both metrics after 2014 suggests a contraction in the scale of current operations or a shift in working capital management strategies.
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Comparison to Competitors
Emerson Electric Co., current ratio, long-term trends, comparison to competitors
| Emerson Electric Co. | Boeing Co. | Caterpillar Inc. | Eaton Corp. plc | GE Aerospace | Honeywell International Inc. | Lockheed Martin Corp. | RTX Corp. | |
|---|---|---|---|---|---|---|---|---|
| Sep 30, 2019 | 1.19 | 1.05 | 1.47 | 1.70 | 1.16 | 1.34 | 1.22 | 1.08 |
| Sep 30, 2018 | 1.07 | 1.08 | 1.37 | 1.47 | — | 1.29 | 1.12 | 1.13 |
| Sep 30, 2017 | 1.64 | 1.16 | 1.35 | 1.64 | — | 1.38 | 1.38 | 1.35 |
| Sep 30, 2016 | 1.24 | 1.25 | 1.22 | 1.27 | — | 1.41 | 1.20 | 1.30 |
| Sep 30, 2015 | 1.29 | 1.35 | 1.31 | 1.43 | — | 1.09 | 1.15 | 1.18 |
| Sep 30, 2014 | 1.29 | 1.20 | 1.39 | 1.51 | — | 1.50 | 1.11 | 1.30 |
| Sep 30, 2013 | 1.44 | 1.26 | 1.40 | 1.78 | — | 1.49 | 1.20 | 1.29 |
| Sep 30, 2012 | 1.42 | 1.27 | 1.43 | 1.44 | — | 1.35 | 1.14 | 1.24 |
| Sep 30, 2011 | 1.45 | 1.21 | 1.33 | 1.60 | — | 1.31 | 1.16 | 1.38 |
| Sep 30, 2010 | 1.43 | 1.15 | 1.44 | 1.70 | — | 1.28 | 1.15 | 1.33 |
| Sep 30, 2009 | 1.54 | 1.07 | 1.39 | 1.68 | — | 1.25 | 1.17 | 1.29 |
| Sep 30, 2008 | 1.42 | 0.84 | 1.21 | 1.28 | — | 1.08 | 1.01 | 1.24 |
| Sep 30, 2007 | 1.45 | 0.86 | 1.15 | 1.30 | — | 1.15 | 1.11 | 1.26 |
| Sep 30, 2006 | 1.36 | 0.77 | 1.20 | 1.29 | — | 1.21 | 1.06 | 1.24 |
| Sep 30, 2005 | 1.39 | 0.78 | 1.19 | 1.21 | — | 1.15 | 1.12 | 1.12 |
Based on: 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30), 10-K (reporting date: 2017-09-30), 10-K (reporting date: 2016-09-30), 10-K (reporting date: 2015-09-30), 10-K (reporting date: 2014-09-30), 10-K (reporting date: 2013-09-30), 10-K (reporting date: 2012-09-30), 10-K (reporting date: 2011-09-30), 10-K (reporting date: 2010-09-30), 10-K (reporting date: 2009-09-30), 10-K (reporting date: 2008-09-30), 10-K (reporting date: 2007-09-30), 10-K (reporting date: 2006-09-30), 10-K (reporting date: 2005-09-30).
Comparison to Sector (Capital Goods)
Emerson Electric Co., current ratio, long-term trends, comparison to sector (capital goods)
| Emerson Electric Co. | Capital Goods | |
|---|---|---|
| Sep 30, 2019 | 1.19 | 1.17 |
| Sep 30, 2018 | 1.07 | 1.17 |
| Sep 30, 2017 | 1.64 | 1.29 |
| Sep 30, 2016 | 1.24 | 1.27 |
| Sep 30, 2015 | 1.29 | 1.26 |
| Sep 30, 2014 | 1.29 | 1.29 |
| Sep 30, 2013 | 1.44 | 1.34 |
| Sep 30, 2012 | 1.42 | 1.31 |
| Sep 30, 2011 | 1.45 | 1.29 |
| Sep 30, 2010 | 1.43 | 1.28 |
| Sep 30, 2009 | 1.54 | 1.23 |
| Sep 30, 2008 | 1.42 | 1.07 |
| Sep 30, 2007 | 1.45 | 1.08 |
| Sep 30, 2006 | 1.36 | 1.05 |
| Sep 30, 2005 | 1.39 | 1.03 |
Based on: 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30), 10-K (reporting date: 2017-09-30), 10-K (reporting date: 2016-09-30), 10-K (reporting date: 2015-09-30), 10-K (reporting date: 2014-09-30), 10-K (reporting date: 2013-09-30), 10-K (reporting date: 2012-09-30), 10-K (reporting date: 2011-09-30), 10-K (reporting date: 2010-09-30), 10-K (reporting date: 2009-09-30), 10-K (reporting date: 2008-09-30), 10-K (reporting date: 2007-09-30), 10-K (reporting date: 2006-09-30), 10-K (reporting date: 2005-09-30).
Comparison to Industry (Industrials)
Emerson Electric Co., current ratio, long-term trends, comparison to industry (industrials)
| Emerson Electric Co. | Industrials | |
|---|---|---|
| Sep 30, 2019 | 1.19 | 1.16 |
| Sep 30, 2018 | 1.07 | 1.13 |
| Sep 30, 2017 | 1.64 | 1.24 |
| Sep 30, 2016 | 1.24 | 1.22 |
| Sep 30, 2015 | 1.29 | 1.24 |
| Sep 30, 2014 | 1.29 | 1.26 |
| Sep 30, 2013 | 1.44 | 1.33 |
| Sep 30, 2012 | 1.42 | 1.30 |
| Sep 30, 2011 | 1.45 | 1.30 |
| Sep 30, 2010 | 1.43 | 1.28 |
| Sep 30, 2009 | 1.54 | 1.23 |
| Sep 30, 2008 | 1.42 | 1.06 |
| Sep 30, 2007 | 1.45 | 1.07 |
| Sep 30, 2006 | 1.36 | 1.05 |
| Sep 30, 2005 | 1.39 | 1.05 |
Based on: 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30), 10-K (reporting date: 2017-09-30), 10-K (reporting date: 2016-09-30), 10-K (reporting date: 2015-09-30), 10-K (reporting date: 2014-09-30), 10-K (reporting date: 2013-09-30), 10-K (reporting date: 2012-09-30), 10-K (reporting date: 2011-09-30), 10-K (reporting date: 2010-09-30), 10-K (reporting date: 2009-09-30), 10-K (reporting date: 2008-09-30), 10-K (reporting date: 2007-09-30), 10-K (reporting date: 2006-09-30), 10-K (reporting date: 2005-09-30).