International Business Machines Corp. (IBM)


Liquidity Analysis

Difficulty: Beginner


Ratios (Summary)

International Business Machines Corp., liquidity ratios

Microsoft Excel LibreOffice Calc
Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014
Current ratio 1.29 1.33 1.21 1.24 1.25
Quick ratio 1.12 1.19 1.04 1.07 1.02
Cash ratio 0.32 0.34 0.24 0.24 0.21

Based on: 10-K (filing date: 2019-02-26), 10-K (filing date: 2018-02-27), 10-K (filing date: 2017-02-28), 10-K (filing date: 2016-02-23), 10-K (filing date: 2015-02-24).

Ratio Description The company
Current ratio A liquidity ratio calculated as current assets divided by current liabilities. International Business Machines Corp.’s current ratio improved from 2016 to 2017 but then slightly deteriorated from 2017 to 2018.
Quick ratio A liquidity ratio calculated as (cash plus short-term marketable investments plus receivables) divided by current liabilities. International Business Machines Corp.’s quick ratio improved from 2016 to 2017 but then slightly deteriorated from 2017 to 2018.
Cash ratio A liquidity ratio calculated as (cash plus short-term marketable investments) divided by current liabilities. International Business Machines Corp.’s cash ratio improved from 2016 to 2017 but then slightly deteriorated from 2017 to 2018.

Current Ratio

International Business Machines Corp., current ratio calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014
Selected Financial Data (USD $ in millions)
Current assets 49,146  49,735  43,888  42,504  49,422 
Current liabilities 38,227  37,363  36,275  34,269  39,600 
Ratio
Current ratio1 1.29 1.33 1.21 1.24 1.25
Benchmarks
Current Ratio, Competitors
Adobe Inc. 1.13 2.05 2.08 2.18 1.85
Alphabet Inc. 3.92 5.14 6.29 4.67 4.80
Facebook Inc. 7.19 12.92 11.97 11.25 9.60
Intuit Inc. 1.14 0.73 0.72 1.47 1.84
Microsoft Corp. 2.90 2.48 2.35 2.50 2.50
Oracle Corp. 3.96 3.08 3.74 4.13 3.35
salesforce.com inc. 0.92 0.83 0.77 0.81 0.67
Current Ratio, Sector
Software & Computer Services 2.86 2.83 2.79 2.74 2.51
Current Ratio, Industry
Technology 2.09 2.31 2.27 2.16 2.04

Based on: 10-K (filing date: 2019-02-26), 10-K (filing date: 2018-02-27), 10-K (filing date: 2017-02-28), 10-K (filing date: 2016-02-23), 10-K (filing date: 2015-02-24).

2018 Calculations

1 Current ratio = Current assets ÷ Current liabilities
= 49,146 ÷ 38,227 = 1.29

Ratio Description The company
Current ratio A liquidity ratio calculated as current assets divided by current liabilities. International Business Machines Corp.’s current ratio improved from 2016 to 2017 but then slightly deteriorated from 2017 to 2018.

Quick Ratio

International Business Machines Corp., quick ratio calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014
Selected Financial Data (USD $ in millions)
Cash and cash equivalents 11,379  11,972  7,826  7,686  8,476 
Restricted cash 225  262  –  –  – 
Marketable securities 618  608  701  508  – 
Notes and accounts receivable, trade, net of allowances 7,432  8,928  9,182  8,333  9,090 
Short-term financing receivables, net of allowances 22,388  21,721  19,006  19,020  19,835 
Other accounts receivable, net of allowances 743  981  1,057  1,201  2,906 
Total quick assets 42,785  44,472  37,772  36,748  40,307 
Current liabilities 38,227  37,363  36,275  34,269  39,600 
Ratio
Quick ratio1 1.12 1.19 1.04 1.07 1.02
Benchmarks
Quick Ratio, Competitors
Adobe Inc. 1.06 2.00 1.99 2.11 1.74
Alphabet Inc. 3.75 4.97 6.00 4.38 4.39
Facebook Inc. 6.94 12.64 11.63 10.91 9.04
Intuit Inc. 0.86 0.45 0.53 1.03 1.44
Microsoft Corp. 2.74 2.37 2.22 2.30 2.31
Oracle Corp. 3.78 2.95 3.57 3.92 3.12
salesforce.com inc. 0.83 0.74 0.68 0.66 0.55
Quick Ratio, Sector
Software & Computer Services 2.69 2.70 2.62 2.53 2.27
Quick Ratio, Industry
Technology 1.87 2.10 2.04 1.87 1.73

Based on: 10-K (filing date: 2019-02-26), 10-K (filing date: 2018-02-27), 10-K (filing date: 2017-02-28), 10-K (filing date: 2016-02-23), 10-K (filing date: 2015-02-24).

2018 Calculations

1 Quick ratio = Total quick assets ÷ Current liabilities
= 42,785 ÷ 38,227 = 1.12

Ratio Description The company
Quick ratio A liquidity ratio calculated as (cash plus short-term marketable investments plus receivables) divided by current liabilities. International Business Machines Corp.’s quick ratio improved from 2016 to 2017 but then slightly deteriorated from 2017 to 2018.

Cash Ratio

International Business Machines Corp., cash ratio calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014
Selected Financial Data (USD $ in millions)
Cash and cash equivalents 11,379  11,972  7,826  7,686  8,476 
Restricted cash 225  262  –  –  – 
Marketable securities 618  608  701  508  – 
Total cash assets 12,222  12,842  8,527  8,194  8,476 
Current liabilities 38,227  37,363  36,275  34,269  39,600 
Ratio
Cash ratio1 0.32 0.34 0.24 0.24 0.21
Benchmarks
Cash Ratio, Competitors
Adobe Inc. 0.75 1.65 1.69 1.80 1.50
Alphabet Inc. 3.15 4.21 5.15 3.78 3.83
Facebook Inc. 5.86 11.09 10.24 9.58 7.86
Intuit Inc. 0.81 0.40 0.48 0.97 1.35
Microsoft Corp. 2.29 2.06 1.91 1.94 1.88
Oracle Corp. 3.50 2.73 3.26 3.56 2.70
salesforce.com inc. 0.45 0.30 0.24 0.23 0.21
Cash Ratio, Sector
Software & Computer Services 2.14 2.18 2.10 1.99 1.71
Cash Ratio, Industry
Technology 1.40 1.67 1.61 1.42 1.25

Based on: 10-K (filing date: 2019-02-26), 10-K (filing date: 2018-02-27), 10-K (filing date: 2017-02-28), 10-K (filing date: 2016-02-23), 10-K (filing date: 2015-02-24).

2018 Calculations

1 Cash ratio = Total cash assets ÷ Current liabilities
= 12,222 ÷ 38,227 = 0.32

Ratio Description The company
Cash ratio A liquidity ratio calculated as (cash plus short-term marketable investments) divided by current liabilities. International Business Machines Corp.’s cash ratio improved from 2016 to 2017 but then slightly deteriorated from 2017 to 2018.