Analysis of Liquidity Ratios
Quarterly Data
Liquidity ratios measure the company ability to meet its short-term obligations.
Liquidity Ratios (Summary)
Hilton Worldwide Holdings Inc., liquidity ratios (quarterly data)
Based on: 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), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
- Current Ratio Analysis
- The current ratio exhibited significant volatility over the analyzed periods. Beginning at 0.67 in March 2019, it showed gradual improvement through 2019, reaching a peak of 1.99 in September 2020. This increase suggests a marked improvement in the company’s short-term liquidity during this period. Subsequently, the ratio declined steadily throughout 2021 and 2022, falling below 1.0 by mid-2022. In 2023 and into mid-2024, the current ratio remained below 1.0, ending at 0.64 in June 2024, indicating a potential tightening of current asset availability relative to current liabilities.
- Quick Ratio Analysis
- Mirroring the trend of the current ratio, the quick ratio started at 0.56 in March 2019 and increased steadily to a high of 1.91 by June 2020. This peak reflects enhanced liquidity in terms of the most liquid assets, excluding inventories. Following this peak, a downward trend is observed, with the ratio dropping below 1.0 by mid-2021. Through 2022 and 2023, the quick ratio continued to decline gradually, reaching 0.56 in June 2024. This decline underscores a reduction in the company's ability to quickly cover current liabilities with near-cash assets over time.
- Cash Ratio Analysis
- The cash ratio displayed the most pronounced fluctuations among the liquidity metrics. It increased sharply from 0.16 in March 2019 to 1.55 in June 2020, indicating a significant accumulation of cash and cash equivalents relative to current liabilities during the early phase of the COVID-19 pandemic. After this peak, the cash ratio decreased continuously, falling below 0.5 by late 2021 and reaching its lowest point of 0.19 by June 2024. This decline suggests that the company has reduced its cash holdings relative to current liabilities, which may impact its immediate liquidity position.
- Overall Liquidity Trends and Insights
- All three liquidity ratios improved notably from early 2019 through mid-2020, likely reflecting strategic liquidity management during uncertain market conditions. However, from late 2020 onward, there is a consistent downward trend across the current, quick, and cash ratios. By mid-2024, each ratio was below or near 0.6, suggesting that the company’s short-term financial flexibility has diminished compared to the peak periods. The sustained decrease in liquidity ratios might warrant further investigation into operational cash flows, working capital management, and potential external financing needs. This pattern could also reflect increased current liabilities or reduced current assets, signaling potential financial constraints or changes in business conditions.
Current Ratio
Hilton Worldwide Holdings Inc., current ratio calculation (quarterly data)
| 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 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||||||
| Current assets | 2,689) | 3,183) | 2,614) | 2,484) | 2,580) | 2,561) | 2,870) | 2,976) | 2,840) | 2,861) | 2,871) | 2,694) | 2,379) | 3,468) | 4,202) | 4,584) | 4,577) | 3,149) | 2,093) | 2,255) | 2,215) | 1,876) | |||||||
| Current liabilities | 4,226) | 3,774) | 3,722) | 3,561) | 3,435) | 3,390) | 3,372) | 3,365) | 3,195) | 3,085) | 3,019) | 2,622) | 2,779) | 2,476) | 2,431) | 2,299) | 2,306) | 2,220) | 2,871) | 2,900) | 2,780) | 2,794) | |||||||
| Liquidity Ratio | |||||||||||||||||||||||||||||
| Current ratio1 | 0.64 | 0.84 | 0.70 | 0.70 | 0.75 | 0.76 | 0.85 | 0.88 | 0.89 | 0.93 | 0.95 | 1.03 | 0.86 | 1.40 | 1.73 | 1.99 | 1.98 | 1.42 | 0.73 | 0.78 | 0.80 | 0.67 | |||||||
| Benchmarks | |||||||||||||||||||||||||||||
| Current Ratio, Competitors2 | |||||||||||||||||||||||||||||
| Airbnb Inc. | 1.41 | 1.44 | 1.66 | 1.78 | 1.47 | 1.55 | 1.86 | 1.85 | 1.58 | 1.61 | 1.95 | 1.86 | 1.48 | 1.66 | — | — | — | — | — | — | — | — | |||||||
| Booking Holdings Inc. | 1.17 | 1.22 | 1.28 | 1.44 | 1.55 | 1.59 | 1.86 | 1.45 | 1.45 | 1.72 | 2.10 | 2.48 | 2.05 | 2.18 | 3.56 | 3.17 | 2.93 | 2.24 | — | — | — | — | |||||||
| Chipotle Mexican Grill Inc. | 1.71 | 1.65 | 1.57 | 1.53 | 1.58 | 1.41 | 1.28 | 1.32 | 1.26 | 1.32 | 1.58 | 1.78 | 1.73 | 1.75 | 1.73 | 1.51 | 1.59 | 1.62 | — | — | — | — | |||||||
| DoorDash, Inc. | 1.64 | 1.64 | 1.64 | 1.72 | 1.69 | 1.73 | 1.86 | 2.12 | 2.39 | 2.51 | 2.59 | 3.52 | 4.14 | 4.59 | — | — | — | — | — | — | — | — | |||||||
| McDonald’s Corp. | 1.08 | 0.83 | 1.16 | 1.71 | 1.35 | 1.47 | 1.43 | 1.65 | 1.41 | 1.10 | 1.78 | 1.33 | 1.45 | 1.19 | 1.01 | 1.07 | 0.91 | 1.90 | — | — | — | — | |||||||
| Starbucks Corp. | 0.86 | 0.70 | 0.78 | 0.78 | 0.77 | 0.75 | 0.77 | 0.84 | 0.83 | 0.81 | 1.20 | 1.02 | 1.07 | 1.06 | 1.06 | 0.95 | 0.70 | 0.68 | 0.92 | 1.31 | 0.94 | 1.41 | |||||||
Based on: 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), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q2 2024 Calculation
Current ratio = Current assets ÷ Current liabilities
= 2,689 ÷ 4,226 = 0.64
2 Click competitor name to see calculations.
- Current Assets
- Current assets showed a general upward trend beginning in the first quarter of 2019 through the end of 2020, increasing from 1,876 million US dollars to a peak of 4,584 million US dollars in the third quarter of 2020. Following this peak, the value of current assets declined significantly throughout 2021, reaching a low point of 2,379 million US dollars in the second quarter of 2021. Subsequently, current assets stabilized somewhat, fluctuating narrowly around 2,800 to 3,200 million US dollars through 2022 and early 2023. However, from mid-2023 to mid-2024, current assets experienced variability but did not return to previous highs, ending at 2,689 million US dollars in the second quarter of 2024.
- Current Liabilities
- Current liabilities initially decreased from 2,794 million US dollars at the start of 2019 to a trough of 2,220 million US dollars in the first quarter of 2020. From that point onward, current liabilities generally increased, rising steadily through 2021 and 2022, and continuing this upward movement into 2023 and 2024. By the second quarter of 2024, current liabilities reached their highest recorded value in the dataset at 4,226 million US dollars, indicating mounting short-term obligations over the analyzed period.
- Current Ratio
- The current ratio exhibited notable fluctuation over the timeframe. Initially below 1.0 during 2019, it rose sharply to a peak of nearly 2.0 in the mid to late quarters of 2020, reflecting a significant increase in liquidity during this period. This improvement was temporary, as subsequent quarters saw a consistent decline in the current ratio through 2021 and 2022, falling below 1.0 and reaching as low as 0.64 in the second quarter of 2024. The downward trend in the current ratio in recent periods suggests a decrease in short-term liquidity relative to obligations, which could indicate growing pressure on working capital management or increased reliance on short-term debt.
Quick Ratio
Hilton Worldwide Holdings Inc., quick ratio calculation (quarterly data)
| 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 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||||||
| Cash and cash equivalents | 731) | 1,346) | 800) | 698) | 806) | 901) | 1,209) | 1,282) | 1,175) | 1,432) | 1,427) | 1,288) | 1,044) | 2,402) | 3,218) | 3,405) | 3,503) | 1,734) | 538) | 719) | 635) | 382) | |||||||
| Restricted cash and cash equivalents | 71) | 74) | 75) | 81) | 77) | 77) | 77) | 80) | 79) | 78) | 85) | 99) | 83) | 45) | 45) | 63) | 72) | 71) | 92) | 90) | 83) | 79) | |||||||
| Accounts receivable, net of allowance for credit losses | 1,578) | 1,467) | 1,487) | 1,396) | 1,402) | 1,298) | 1,327) | 1,278) | 1,289) | 1,054) | 1,068) | 1,012) | 952) | 797) | 771) | 890) | 827) | 1,111) | 1,261) | 1,193) | 1,190) | 1,102) | |||||||
| Total quick assets | 2,380) | 2,887) | 2,362) | 2,175) | 2,285) | 2,276) | 2,613) | 2,640) | 2,543) | 2,564) | 2,580) | 2,399) | 2,079) | 3,244) | 4,034) | 4,358) | 4,402) | 2,916) | 1,891) | 2,002) | 1,908) | 1,563) | |||||||
| Current liabilities | 4,226) | 3,774) | 3,722) | 3,561) | 3,435) | 3,390) | 3,372) | 3,365) | 3,195) | 3,085) | 3,019) | 2,622) | 2,779) | 2,476) | 2,431) | 2,299) | 2,306) | 2,220) | 2,871) | 2,900) | 2,780) | 2,794) | |||||||
| Liquidity Ratio | |||||||||||||||||||||||||||||
| Quick ratio1 | 0.56 | 0.76 | 0.63 | 0.61 | 0.67 | 0.67 | 0.77 | 0.78 | 0.80 | 0.83 | 0.85 | 0.91 | 0.75 | 1.31 | 1.66 | 1.90 | 1.91 | 1.31 | 0.66 | 0.69 | 0.69 | 0.56 | |||||||
| Benchmarks | |||||||||||||||||||||||||||||
| Quick Ratio, Competitors2 | |||||||||||||||||||||||||||||
| Airbnb Inc. | 1.38 | 1.41 | 1.62 | 1.75 | 1.45 | 1.52 | 1.83 | 1.82 | 1.55 | 1.59 | 1.91 | 1.83 | 1.46 | 1.62 | — | — | — | — | — | — | — | — | |||||||
| Booking Holdings Inc. | 1.11 | 1.15 | 1.20 | 1.35 | 1.45 | 1.49 | 1.73 | 1.34 | 1.37 | 1.63 | 2.00 | 2.28 | 1.86 | 1.97 | 3.24 | 3.04 | 2.81 | 1.70 | — | — | — | — | |||||||
| Chipotle Mexican Grill Inc. | 1.52 | 1.51 | 1.37 | 1.40 | 1.44 | 1.26 | 1.09 | 1.05 | 1.02 | 1.13 | 1.35 | 1.29 | 1.28 | 1.35 | 1.28 | 1.34 | 1.35 | 1.42 | — | — | — | — | |||||||
| DoorDash, Inc. | 1.35 | 1.35 | 1.35 | 1.42 | 1.41 | 1.43 | 1.54 | 1.87 | 2.14 | 2.23 | 2.33 | 3.32 | 3.93 | 4.35 | — | — | — | — | — | — | — | — | |||||||
| McDonald’s Corp. | 0.82 | 0.63 | 1.03 | 1.43 | 1.04 | 1.25 | 1.24 | 1.35 | 1.07 | 0.95 | 1.64 | 1.20 | 1.23 | 1.04 | 0.90 | 0.97 | 0.84 | 1.77 | — | — | — | — | |||||||
| Starbucks Corp. | 0.56 | 0.48 | 0.55 | 0.52 | 0.51 | 0.48 | 0.48 | 0.52 | 0.55 | 0.57 | 0.93 | 0.75 | 0.75 | 0.78 | 0.75 | 0.63 | 0.43 | 0.46 | 0.59 | 0.95 | 0.54 | 1.05 | |||||||
Based on: 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), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q2 2024 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= 2,380 ÷ 4,226 = 0.56
2 Click competitor name to see calculations.
- Total Quick Assets
- The total quick assets showed an initial moderate increase from March 31, 2019, through September 30, 2019, reaching a peak at 2,002 million USD. There was a notable surge from March 31, 2020, to June 30, 2020, that pushed quick assets to the highest range, fluctuating between 4,402 and 4,034 million USD through December 31, 2020. After this peak, a pronounced decline occurred through 2021, bottoming out around 2,079 million USD in June 30, 2021. Subsequently, the quick assets demonstrated some recovery and relative stability with slight fluctuations around the 2,500 to 2,600 million USD range from March 31, 2022, through December 31, 2022. The asset base then experienced another gradual decline during 2023, reaching a low point near 2,175 million USD in September 30, 2023, followed by an uptick toward the first half of 2024, ending at 2,380 million USD in June 30, 2024.
- Current Liabilities
- Current liabilities maintained a relatively stable level just below 3,000 million USD in 2019, ranging from approximately 2,780 to 2,900 million USD. There was a decrease during the early part of 2020, dropping to about 2,220 million USD by March 31, 2020. However, from mid-2020 onwards, liabilities trended upward consistently, surpassing the 3,000 million USD mark by the end of 2021 and continuing to increase steadily throughout 2022 and 2023. By June 30, 2024, current liabilities reached the highest level observed in the examined period at approximately 4,226 million USD, indicating a significant rise in short-term obligations over the last few years.
- Quick Ratio
- The quick ratio exhibited strong variability over the time frame. Initially, it remained below 1.0 for all quarters in 2019, ranging between 0.56 to 0.69, reflecting limited liquidity relative to current liabilities. During 2020, the quick ratio substantially increased, peaking at 1.91 in June 30, 2020, signifying improved liquidity likely due to the combination of increased quick assets and reduced liabilities early in the year. However, starting in 2021, the ratio declined again, fluctuating mostly below 1.0, with values as low as 0.56 in June 30, 2024. This downward trend suggests a weakening short-term liquidity position, likely driven by the rising current liabilities outpacing the growth or stability in quick assets. The quick ratio's dip below 1.0 for most of the post-2020 period signals potential challenges in covering current liabilities with liquid assets alone.
- Summary
- The financial data reflects significant volatility influenced notably by the external environment around 2020, likely impacting liquidity management. The peak in quick assets and quick ratio during early to mid-2020 may be indicative of strategic liquidity preservation or asset reallocation in response to market or operational disruptions. Following this period, the steady increase in current liabilities combined with fluctuating but generally declining quick assets resulted in a reduction of the quick ratio below 1.0, pointing to a potential erosion in short-term financial strength. Overall, the trends suggest increased pressure on the company's liquidity and working capital management in the most recent years, warranting close monitoring and potentially proactive measures to enhance liquidity resilience.
Cash Ratio
Hilton Worldwide Holdings Inc., cash ratio calculation (quarterly data)
| 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 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||||||
| Cash and cash equivalents | 731) | 1,346) | 800) | 698) | 806) | 901) | 1,209) | 1,282) | 1,175) | 1,432) | 1,427) | 1,288) | 1,044) | 2,402) | 3,218) | 3,405) | 3,503) | 1,734) | 538) | 719) | 635) | 382) | |||||||
| Restricted cash and cash equivalents | 71) | 74) | 75) | 81) | 77) | 77) | 77) | 80) | 79) | 78) | 85) | 99) | 83) | 45) | 45) | 63) | 72) | 71) | 92) | 90) | 83) | 79) | |||||||
| Total cash assets | 802) | 1,420) | 875) | 779) | 883) | 978) | 1,286) | 1,362) | 1,254) | 1,510) | 1,512) | 1,387) | 1,127) | 2,447) | 3,263) | 3,468) | 3,575) | 1,805) | 630) | 809) | 718) | 461) | |||||||
| Current liabilities | 4,226) | 3,774) | 3,722) | 3,561) | 3,435) | 3,390) | 3,372) | 3,365) | 3,195) | 3,085) | 3,019) | 2,622) | 2,779) | 2,476) | 2,431) | 2,299) | 2,306) | 2,220) | 2,871) | 2,900) | 2,780) | 2,794) | |||||||
| Liquidity Ratio | |||||||||||||||||||||||||||||
| Cash ratio1 | 0.19 | 0.38 | 0.24 | 0.22 | 0.26 | 0.29 | 0.38 | 0.40 | 0.39 | 0.49 | 0.50 | 0.53 | 0.41 | 0.99 | 1.34 | 1.51 | 1.55 | 0.81 | 0.22 | 0.28 | 0.26 | 0.16 | |||||||
| Benchmarks | |||||||||||||||||||||||||||||
| Cash Ratio, Competitors2 | |||||||||||||||||||||||||||||
| Airbnb Inc. | 0.71 | 0.78 | 1.01 | 1.12 | 0.76 | 0.87 | 1.21 | 1.20 | 0.88 | 0.95 | 1.31 | 1.21 | 0.78 | 1.00 | — | — | — | — | — | — | — | — | |||||||
| Booking Holdings Inc. | 0.90 | 0.95 | 0.95 | 1.08 | 1.22 | 1.31 | 1.46 | 1.07 | 1.15 | 1.41 | 1.78 | 2.01 | 1.67 | 1.88 | 3.08 | 2.82 | 2.66 | 1.54 | — | — | — | — | |||||||
| Chipotle Mexican Grill Inc. | 1.43 | 1.42 | 1.26 | 1.34 | 1.38 | 1.19 | 0.98 | 0.96 | 0.92 | 1.03 | 1.23 | 1.20 | 1.19 | 1.27 | 1.16 | 1.25 | 1.25 | 1.32 | — | — | — | — | |||||||
| DoorDash, Inc. | 1.21 | 1.20 | 1.20 | 1.28 | 1.27 | 1.28 | 1.38 | 1.72 | 1.97 | 2.04 | 2.13 | 3.11 | 3.73 | 4.09 | — | — | — | — | — | — | — | — | |||||||
| McDonald’s Corp. | 0.20 | 0.17 | 0.67 | 0.87 | 0.44 | 0.80 | 0.68 | 0.81 | 0.54 | 0.55 | 1.17 | 0.85 | 0.77 | 0.66 | 0.56 | 0.59 | 0.45 | 1.35 | — | — | — | — | |||||||
| Starbucks Corp. | 0.42 | 0.36 | 0.42 | 0.39 | 0.38 | 0.36 | 0.35 | 0.39 | 0.44 | 0.45 | 0.81 | 0.63 | 0.62 | 0.67 | 0.63 | 0.52 | 0.32 | 0.36 | 0.45 | 0.82 | 0.40 | 0.92 | |||||||
Based on: 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), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q2 2024 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= 802 ÷ 4,226 = 0.19
2 Click competitor name to see calculations.
- Total cash assets
- The total cash assets exhibit notable volatility over the observed period. Beginning with moderate levels between 461 and 809 million US dollars in early 2019, there is a significant surge in the first half of 2020, peaking at approximately 3,575 million US dollars by June 30, 2020. This increase likely reflects a strategic liquidity build-up amid uncertain economic conditions. Following this peak, cash assets gradually decline through 2021 and 2022, stabilizing around the 1,200 to 1,500 million range before experiencing a marked decrease in early 2023, reaching as low as 778 million US dollars by September 2023. The last two quarters show some recovery, with cash assets rising back to 1,420 million in March 2024, followed by a drop to 802 million by June 2024.
- Current liabilities
- Current liabilities remain relatively stable throughout 2019 and early 2020, fluctuating modestly around the 2,780 to 2,900 million US dollar range. From mid-2020 onward, there is a gradual and consistent upward trend, reflecting increasing short-term obligations. This growth accelerates notably during 2023 and into mid-2024, with liabilities climbing from approximately 3,390 million in early 2023 to 4,226 million by June 2024. This continuous increase suggests rising operational or financial pressures requiring short-term funding.
- Cash ratio
- The cash ratio shows a considerable degree of fluctuation, mirroring the changes observed in cash assets and current liabilities. It starts at relatively low levels of 0.16 to 0.28 in 2019, then sharply ascends in the first half of 2020 to a peak of 1.55, indicating a robust liquidity position able to cover current liabilities more than one and a half times with cash alone. However, from mid-2020 onward, the ratio experiences a steady decline, dropping below 0.5 throughout 2021 and 2022, and further falling to under 0.3 by late 2023. The final reported quarters into mid-2024 show the lowest ratio at 0.19, signaling a decrease in liquidity relative to short-term liabilities and potentially heightened short-term financial risk.
- Overall trends and insights
- The data reveal an initial liquidity strengthening phase in early 2020, possibly in response to external stressors impacting the industry or economy. This phase is characterized by elevated cash reserves and a cash ratio well above 1.0, indicating a conservative liquidity management approach. Subsequently, the company experiences a gradual decline in liquidity, with cash assets reducing and current liabilities increasing, resulting in a declining cash ratio. The consistent increase in current liabilities, coupled with diminishing cash coverage, suggests rising working capital demands or increased short-term borrowing. By mid-2024, the liquidity position is more constrained than in previous years, potentially reflecting a shift towards leveraging liabilities rather than cash reserves for funding operational needs. This trend warrants attention for liquidity risk management going forward.