Honeywell International Inc. (NASDAQ:HON)

Honeywell’s liquidity position, as indicated by the observed ratios, demonstrates some fluctuation over the analyzed period spanning from March 2022 to December 2025. Generally, the ratios exhibit a degree of cyclicality, with periods of improvement followed by stabilization or slight decline. A notable increase in liquidity is observed in the first half of 2024, followed by a partial retracement.

Current Ratio

The current ratio generally remained above 1.20 throughout the period, suggesting a consistent ability to cover short-term liabilities with short-term assets. A slight upward trend was evident from March 2022 through December 2022, peaking at 1.25. The ratio experienced a dip in the first quarter of 2023 before rising significantly to 1.66 by March 2024. Subsequent quarters saw a decline to 1.30 by December 2025, though still remaining above the initial levels observed in 2022.

Quick Ratio

The quick ratio, a more conservative measure of liquidity, followed a similar pattern to the current ratio, though at lower values. It remained relatively stable between 0.82 and 0.98 from March 2022 to December 2022. A substantial increase to 1.18 was observed by March 2024, mirroring the trend in the current ratio. This was followed by a decrease, settling at 0.88 in December 2025. The quick ratio consistently remained below 1.0 for most of the period, indicating a potential reliance on inventory to meet immediate obligations.

Cash Ratio

The cash ratio, the most conservative liquidity measure, exhibited the least amount of fluctuation. It remained relatively stable between 0.40 and 0.51 for much of the period. A notable increase to 0.73 was observed in March 2024, coinciding with the increases in the other liquidity ratios. The ratio then decreased to 0.55 by December 2025, but remained within the historical range. This suggests a consistent, though limited, ability to cover immediate liabilities with cash and cash equivalents.

The concurrent increases in all three ratios during the first half of 2024 suggest a deliberate strategy to bolster the company’s short-term liquidity, potentially in anticipation of increased obligations or to capitalize on investment opportunities. The subsequent partial retracement in the latter half of 2024 and into 2025 may indicate a normalization of working capital or deployment of excess cash. Overall, the liquidity position appears manageable, though the quick ratio consistently below 1.0 warrants continued monitoring.

The current ratio exhibited fluctuations over the observed period, generally indicating a healthy, though varying, ability to cover short-term liabilities with short-term assets. An initial period of relative stability is followed by a notable increase and subsequent moderation.

Initial Stability (Mar 31, 2022 – Dec 31, 2022)

The current ratio remained relatively consistent between 1.20 and 1.26 during this timeframe. This suggests a stable short-term financial position with a comfortable margin of current assets over current liabilities. Minor quarterly variations did not indicate a significant shift in liquidity.

Improvement and Peak (Mar 31, 2023 – Jun 30, 2023)

A substantial increase in the current ratio is observed, rising from 1.26 to 1.41. This improvement suggests a strengthening of the short-term financial position, potentially due to an increase in current assets, a decrease in current liabilities, or a combination of both. The ratio peaked at 1.41 in the second quarter of 2023.

Subsequent Moderation (Sep 30, 2023 – Dec 31, 2023)

Following the peak, the current ratio experienced a decline, falling to 1.27 by the end of 2023. While still above 1.0, this decrease indicates a potential weakening of the short-term liquidity position compared to the previous quarter. This could be attributed to increased current liabilities or a reduction in current assets.

Further Fluctuations and Recent Trend (Mar 31, 2024 – Dec 31, 2025)

The ratio demonstrated further volatility, reaching a high of 1.66 in the first quarter of 2024 before decreasing to 1.30 by the end of 2025. The most recent quarters show a slight downward trend, although the ratio remains above 1.25, suggesting continued, albeit potentially diminishing, short-term solvency. The increase to 1.66 in early 2024 represents the highest point in the observed period.

Overall, the current ratio indicates a generally healthy liquidity position throughout the analyzed period. However, the fluctuations observed, particularly the decline from the peak in mid-2023 and the recent downward trend, warrant continued monitoring to ensure sustained short-term financial stability.

The quick ratio for the analyzed period demonstrates fluctuations, generally remaining below 1.0 until the first quarter of 2024. A subsequent increase is observed, followed by a return towards previous levels. The ratio indicates the company’s ability to meet its short-term obligations with its most liquid assets, excluding inventory.

Overall Trend

From March 2022 through December 2023, the quick ratio largely oscillated between 0.82 and 0.98. A significant increase to 1.18 was noted in March 2024, representing the highest point in the observed period. However, the ratio decreased to 0.83 in June 2024, and has remained relatively stable between 0.88 and 0.98 through December 2025.

Short-Term Fluctuations

A slight decrease in the quick ratio is visible from the first to the third quarter of 2022, followed by a recovery in the fourth quarter. A similar pattern occurs between March and December 2023. The most substantial short-term change is the increase from 0.92 in September 2023 to 1.18 in March 2024.

Asset and Liability Relationship

Total quick assets generally increased over the period, moving from US$16,893 million in March 2022 to US$20,551 million in December 2025. Current liabilities also increased, from US$20,027 million to US$23,414 million over the same timeframe. The increase in quick assets appears to be insufficient to consistently maintain a quick ratio above 1.0, suggesting that liability growth has outpaced the growth of highly liquid assets for much of the period.

Recent Performance

The latest reported quick ratio, as of December 2025, is 0.88. This is consistent with the ratio observed in the fourth quarters of 2022 and 2024, and indicates a return to the lower end of the range seen throughout the analyzed period. The ratio in June 2025 (0.98) suggests a slight improvement prior to the December 2025 value.

The cash ratio for the analyzed period demonstrates fluctuations, generally indicating a moderate ability to meet current obligations with solely cash and cash equivalents. An initial decline is observed, followed by periods of improvement and subsequent variability.

Overall Trend

The cash ratio began at 0.49 in March 2022 and experienced a decrease to 0.40 by March 2023. A subsequent increase to 0.59 was noted in September 2025, though it finished the period at 0.55 in December 2025. This suggests a cyclical pattern with periods of strengthening and weakening cash positions relative to immediate liabilities.

Short-Term Fluctuations (2022-2023)

From March 2022 to March 2023, the cash ratio decreased from 0.49 to 0.40. This decline coincided with a relatively stable level of current liabilities, suggesting a more significant decrease in total cash assets during this timeframe. A recovery was then seen in June 2023, reaching 0.51, indicating a replenishment of cash assets.

Recent Performance (2024-2025)

A substantial increase in the cash ratio to 0.73 was observed in March 2024, representing the highest point in the analyzed period. This was driven by a significant rise in total cash assets while current liabilities decreased. However, this ratio decreased to 0.47 in June 2024, likely due to an increase in current liabilities. The ratio then showed improvement through September 2025 (0.59) before settling at 0.55 in December 2025.

Relationship to Liabilities

Current liabilities generally remained between US$17 billion and US$23 billion throughout the period. The cash ratio’s fluctuations were more closely tied to changes in total cash assets than to significant shifts in current liabilities. Periods of ratio increase generally corresponded with increases in cash assets, and vice versa.

In conclusion, the cash ratio indicates a variable, but generally moderate, short-term liquidity position. The company appears capable of covering a substantial portion of its current liabilities with available cash, but the ratio’s sensitivity to changes in cash asset levels warrants continued monitoring.