GE Aerospace (NYSE:GE)

Current ratio

The current ratio exhibits a general upward trend from March 2020, beginning at 1.14 and reaching a peak of 1.96 in March 2021. This indicates improving short-term liquidity during this period. However, after this peak, the ratio declines steadily, dropping below 1.1 by June 2025. This downward trend suggests a gradual reduction in the company's ability to cover short-term liabilities with current assets over the longer term.

Quick ratio

The quick ratio shows a similar initial increase, moving from 0.91 in March 2020 to a high point of 1.27 by December 2020. Subsequently, it experiences volatility, decreasing to as low as 0.7 by June 2025. The early peak followed by a downward trend implies that the more liquid assets, excluding inventories, were initially improving but then diminished in proportion relative to current liabilities. The fluctuations in the middle periods reflect some instability in assets that can be quickly converted to cash.

Cash ratio

The cash ratio starts at 0.67 in March 2020, rises slightly to 0.78 by December 2020, but then follows a consistent declining pattern, reaching 0.33 by June 2025. This indicates a diminishing level of cash and cash equivalents relative to current liabilities, pointing to a weakening cash position over time. Despite some minor recoveries in certain quarters, the overall trend suggests reduced immediate liquidity reserves.

Current Assets

Current assets exhibited a fluctuating trend over the observed periods. After starting at approximately 80.2 billion USD in March 2020, the figure declined to a low point of around 56.4 billion USD in September 2023. A notable peak occurred in March 2021 at approximately 113.2 billion USD, followed by a progressive decline through 2022 and 2023. The most recent data points in 2024 and 2025 reflect stabilization around the 37.5 billion USD mark, indicating a significant reduction from the earlier years.

Current Liabilities

Current liabilities generally remained within a narrower range compared to current assets but showed a moderate downward trend overall. Beginning at about 70.3 billion USD in the first quarter of 2020, liabilities decreased to roughly 48.2 billion USD by December 2021, with a slight recovery and fluctuation through 2022 and 2023. From 2024 to mid-2025, liabilities stabilized around 34 to 36.5 billion USD, signifying an overall reduction relative to the initial period.

Current Ratio

The current ratio demonstrated considerable volatility. Initially, it ranged between 1.14 and 1.58 from the beginning of 2020 to the end of 2020, reflecting improving liquidity. The ratio peaked at 1.96 in March 2021, suggesting strong short-term solvency at that time. However, following this peak, the current ratio declined steadily, moving closer to 1.0 by the end of the observation period. By mid-2025, the current ratio was slightly above 1.0 (1.04), indicating a tighter liquidity position but still maintaining coverage of current liabilities by current assets.

In summary, the data indicate that current assets and current liabilities both experienced a downward trend in absolute terms over the examined quarters, with a more pronounced reduction in current assets. The current ratio initially improved but then declined toward levels near unity, suggesting that liquidity and short-term financial flexibility weakened over the period. This tendency towards lower liquidity metrics may signal increased attention needed for working capital management going forward.

Trend in Total Quick Assets

The total quick assets demonstrated a general downward trajectory across the periods. Starting from approximately 64,211 million USD in March 2020, the value decreased with some fluctuations, reaching about 25,430 million USD by June 2025. This reflects a significant reduction in highly liquid assets available in the short term.

Trend in Current Liabilities

Current liabilities exhibited relative stability with moderate fluctuations. Initially at around 70,305 million USD in March 2020, liabilities decreased notably by the end of 2021 and early 2022, hovering between 48,000 and 57,000 million USD. However, from early 2024 onwards, there was an increase noted, with liabilities rising to approximately 36,466 million USD in June 2025, indicating a recent uptick in short-term obligations.

Trend in Quick Ratio

The quick ratio started below 1.0 in early 2020, indicating quick assets were less than current liabilities initially. It improved and peaked at 1.27 at the end of 2020, suggesting a brief period of strengthened liquidity. Afterward, the ratio declined steadily, remaining under 1.0 throughout 2022 to mid-2025, ending near 0.7. This decline suggests decreasing short-term liquidity and a margin of quick assets insufficient to cover current liabilities over time.

Overall Liquidity Analysis

The combination of steadily falling total quick assets and fluctuating but generally high current liabilities led to a deteriorating liquidity position over the observed quarters. The decreasing quick ratio highlights a reduction in immediately available assets to meet short-term debts, signaling potential liquidity stress or a shift in asset structure toward less liquid components.

Implications

The observed trends imply that the company may face increasing challenges in covering short-term obligations without relying on inventory sales or additional financing. Monitoring liquidity closely and managing current liabilities more aggressively could be essential to maintain financial stability.

Total Cash Assets

The total cash assets exhibit a declining trend over the periods analyzed. Starting from US$47,286 million at the end of March 2020, the cash assets decreased significantly in subsequent quarters, reaching a low point around the June to September 2024 period, with values near US$15,445 million and US$15,956 million, respectively. Although minor fluctuations are observed, such as a temporary increase to US$24,871 million in December 2022, the overall pattern is one of gradual reduction through to June 2025, where cash assets are reported at US$11,859 million.

Current Liabilities

Current liabilities display some variability but remain relatively stable over time, with values oscillating mostly between approximately US$34,000 million and US$58,000 million. Initially, liabilities were high at US$70,305 million in March 2020, then declined to around US$51,953 million by December 2021. Starting in 2022, liabilities continued an inconsistent pattern but generally remained lower compared to early 2020 levels. The lowest levels are observed from mid-2023 through mid-2024 (near US$32,750 million), followed by a gradual increase again towards June 2025, ending at about US$36,466 million.

Cash Ratio

The cash ratio, indicating liquidity by comparing cash assets to current liabilities, declined significantly over the observed period. Beginning at 0.67 in March 2020, the ratio peaked slightly at 0.78 in December 2020, suggesting a relatively strong cash position relative to liabilities at that time. Thereafter, the liquidity ratio declined to values consistently below 0.5 from early 2022 onward, reaching as low as 0.33 by June 2025. This indicates a decreasing ability to cover short-term obligations using only cash and equivalents, reflecting a weakening in liquidity.

Overall Summary

The financial data collectively indicate a marked decrease in total cash assets over nearly five years, coupled with a fairly stable but generally lower level of current liabilities compared to 2020. The reduction in cash assets outpaces the decrease in liabilities, evidenced by the declining cash ratio, implying an erosion of liquidity reserves. This trend may suggest increasing reliance on other sources of liquidity or changes in working capital management. The temporary increases in cash assets in certain quarters, such as late 2022, do not reverse the overall downward trajectory. The weakening cash ratio over time points to rising risk in meeting short-term obligations solely with cash resources.