Liquidity Analysis

Difficulty: Beginner

Liquidity ratios measure the company's ability to meet its short-term obligations.


Ratios (Summary)

FedEx Corp., liquidity ratios

 
May 31, 2017 May 31, 2016 May 31, 2015 May 31, 2014 May 31, 2013 May 31, 2012
Current ratio 1.59 1.50 1.84 1.82 1.96 1.69
Quick ratio 1.46 1.35 1.59 1.58 1.73 1.40
Cash ratio 0.50 0.44 0.63 0.55 0.86 0.53

Source: Based on data from FedEx Corp. Annual Reports

Ratio Description The company
Current ratio A liquidity ratio calculated as current assets divided by current liabilities. FedEx Corp.'s current ratio deteriorated from 2015 to 2016 but then slightly improved from 2016 to 2017.
Quick ratio A liquidity ratio calculated as (cash plus short-term marketable investments plus receivables) divided by current liabilities. FedEx Corp.'s quick ratio deteriorated from 2015 to 2016 but then slightly improved from 2016 to 2017.
Cash ratio A liquidity ratio calculated as (cash plus short-term marketable investments) divided by current liabilities. FedEx Corp.'s cash ratio deteriorated from 2015 to 2016 but then slightly improved from 2016 to 2017.

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Current Ratio

FedEx Corp., current ratio calculation, comparison to benchmarks

 
May 31, 2017 May 31, 2016 May 31, 2015 May 31, 2014 May 31, 2013 May 31, 2012
Selected Financial Data (USD $ in millions)
Current assets 12,628  11,989  10,941  9,683  11,274  9,056 
Current liabilities 7,918  8,008  5,957  5,312  5,750  5,374 
Ratio
Current ratio1 1.59 1.50 1.84 1.82 1.96 1.69
Benchmarks
Current Ratio, Competitors
Union Pacific Corp. 1.02 0.99 1.29 1.24 1.05
United Parcel Service Inc. 1.22 1.18 1.23 1.37 1.88
Current Ratio, Sector
Industrial Transportation 1.31 1.26 1.42 1.48 1.72
Current Ratio, Industry
Industrials 1.21 1.10 1.10 1.27 1.30

Source: Based on data from FedEx Corp. Annual Reports

2017 Calculations

1 Current ratio = Current assets ÷ Current liabilities
= 12,628 ÷ 7,918 = 1.59

Ratio Description The company
Current ratio A liquidity ratio calculated as current assets divided by current liabilities. FedEx Corp.'s current ratio deteriorated from 2015 to 2016 but then slightly improved from 2016 to 2017.

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Quick Ratio

FedEx Corp., quick ratio calculation, comparison to benchmarks

 
May 31, 2017 May 31, 2016 May 31, 2015 May 31, 2014 May 31, 2013 May 31, 2012
Selected Financial Data (USD $ in millions)
Cash and cash equivalents 3,969  3,534  3,763  2,908  4,917  2,843 
Receivables, less allowances 7,599  7,252  5,719  5,460  5,044  4,704 
Total quick assets 11,568  10,786  9,482  8,368  9,961  7,547 
Current liabilities 7,918  8,008  5,957  5,312  5,750  5,374 
Ratio
Quick ratio1 1.46 1.35 1.59 1.58 1.73 1.40
Benchmarks
Quick Ratio, Competitors
Union Pacific Corp. 0.70 0.70 0.86 0.85 0.75
United Parcel Service Inc. 1.01 1.05 1.11 1.15 1.65
Quick Ratio, Sector
Industrial Transportation 1.11 1.09 1.21 1.21 1.47
Quick Ratio, Industry
Industrials 0.72 0.62 0.61 0.72 0.75

Source: Based on data from FedEx Corp. Annual Reports

2017 Calculations

1 Quick ratio = Total quick assets ÷ Current liabilities
= 11,568 ÷ 7,918 = 1.46

Ratio Description The company
Quick ratio A liquidity ratio calculated as (cash plus short-term marketable investments plus receivables) divided by current liabilities. FedEx Corp.'s quick ratio deteriorated from 2015 to 2016 but then slightly improved from 2016 to 2017.

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Cash Ratio

FedEx Corp., cash ratio calculation, comparison to benchmarks

 
May 31, 2017 May 31, 2016 May 31, 2015 May 31, 2014 May 31, 2013 May 31, 2012
Selected Financial Data (USD $ in millions)
Cash and cash equivalents 3,969  3,534  3,763  2,908  4,917  2,843 
Total cash assets 3,969  3,534  3,763  2,908  4,917  2,843 
Current liabilities 7,918  8,008  5,957  5,312  5,750  5,374 
Ratio
Cash ratio1 0.50 0.44 0.63 0.55 0.86 0.53
Benchmarks
Cash Ratio, Competitors
Union Pacific Corp. 0.32 0.35 0.43 0.42 0.38
United Parcel Service Inc. 0.32 0.39 0.44 0.38 0.74
Cash Ratio, Sector
Industrial Transportation 0.38 0.40 0.50 0.44 0.70
Cash Ratio, Industry
Industrials 0.32 0.25 0.24 0.32 0.35

Source: Based on data from FedEx Corp. Annual Reports

2017 Calculations

1 Cash ratio = Total cash assets ÷ Current liabilities
= 3,969 ÷ 7,918 = 0.50

Ratio Description The company
Cash ratio A liquidity ratio calculated as (cash plus short-term marketable investments) divided by current liabilities. FedEx Corp.'s cash ratio deteriorated from 2015 to 2016 but then slightly improved from 2016 to 2017.

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