Linde plc (NASDAQ:LIN)

The analysis of the liquidity ratios over the examined periods reveals evolving patterns indicative of changes in short-term financial health and cash management.

Current Ratio

The current ratio fluctuated within a moderate range, beginning at 0.74 in March 2020 and experiencing slight oscillations throughout the subsequent years. Notably, it reached a low of 0.71 in June 2021 and subsequently increased, peaking at 0.96 in December 2024. This upward trend toward the later periods suggests a gradual improvement in the company's capacity to cover its short-term liabilities with its current assets, indicating enhanced liquidity positions.

Quick Ratio

The quick ratio, reflecting the company's ability to meet short-term obligations without relying on inventory sales, showed a similar pattern of initial fluctuation followed by incremental growth. It started at 0.54 in March 2020, dipped slightly mid-2021, and then improved to 0.73 by both September 2024 and March 2025. This increase underscores a strengthening of liquid assets relative to current liabilities, enhancing the firm's immediate liquidity position over time.

Cash Ratio

The cash ratio exhibited more pronounced variability. Initially at 0.26 in March 2020, it experienced declines around mid-2021, reaching lows near 0.21, before recovering steadily to attain a higher level of 0.37 by the end of 2024 and maintained at 0.37 in March 2025. This progression indicates an improving cash reserve relative to current liabilities, suggesting better cash management and increased readiness to cover short-term obligations solely with cash and cash equivalents.

Overall, the liquidity indicators reflect a trajectory of gradual strengthening liquidity and improved short-term financial resilience across the timeframe, with ratios moving closer to or above the generally desirable benchmark of 1 in some periods, especially toward the most recent quarters.

Current Assets Trend

The current assets exhibit a fluctuating pattern over the observed quarters. Starting at 11,513 million USD in March 2020, the value rises to a peak around December 2022 at 13,047 million USD. Subsequently, there are periods of decline and recovery, with values moving between approximately 11,400 million USD and 13,600 million USD through March 2025. Overall, the current assets tend to increase moderately over the entire period despite intermittent decreases.

Current Liabilities Trend

Current liabilities show considerable variability within the same timeframe. The amount declines from 15,490 million USD in March 2020 to around 13,640 million USD by December 2020, followed by an upward movement peaking at 17,785 million USD in March 2023. After this peak, liabilities generally decrease, settling near 14,485 million USD by March 2025. The data indicates periods of higher liability accumulation followed by reduction phases.

Current Ratio Analysis

The current ratio fluctuates in response to changes in current assets and liabilities. It initially remains below 1.0, starting at 0.74 and varies slightly within the range of 0.7 to 0.83 until around late 2021. From early 2022 onwards, there is a general upward trend, with the ratio reaching values near or above 0.9 during 2024 and early 2025, peaking at 0.96 in late 2024. This improving ratio suggests a progressive enhancement in short-term liquidity and the company's ability to cover current obligations with current assets over time.

Trend in Total Quick Assets

The total quick assets exhibit fluctuations across the observed periods. Beginning at 8,409 million US dollars in March 2020, there is a general pattern of increase punctuated by declines at certain intervals. Notably, the assets decreased in December 2020 and June 2021 but rebounded thereafter. Starting from March 2022, total quick assets display a recovery trend, peaking above 10,000 million US dollars multiple times in December 2022, March 2024, and September 2024, before slightly contracting but maintaining values above 9,700 million towards March 2025.

Trend in Current Liabilities

Current liabilities show a general movement within a relatively narrow band, with values fluctuating around 14,000 to 17,785 million US dollars. Starting at 15,490 million US dollars in March 2020, liabilities decrease gradually until December 2020, followed by some volatility in subsequent quarters. A peak is observed in March 2023 at 17,785 million US dollars, after which liabilities decline and stabilize around the mid-14,000 million level by March 2025. The fluctuations indicate periods of increased obligations, but no persistent upward or downward trajectory over the entire timeframe.

Analysis of the Quick Ratio

The quick ratio generally remains below 1 throughout the period, reflecting liquid assets insufficient to cover current liabilities without selling inventory. It begins at 0.54 in March 2020, shows some improvement and volatility over the quarters, with a low around 0.52 in June 2021 and subsequent rises reaching up to 0.73 in June and September 2024. The ratio's rise from early 2023 to late 2024 indicates enhanced liquidity or a shift in current liabilities relative to quick assets. A slight decline to 0.67 by December 2024 is observed, followed by a rebound to 0.73 in March 2025.

Overall Insights

The financial data reveals moderate growth and recovery in quick assets after some volatility in 2020 and 2021. Although current liabilities fluctuate, they do not exhibit a clear increasing or decreasing trend, suggesting consistent management of short-term obligations. The moving trend of the quick ratio towards higher values in recent quarters suggests strengthening liquidity positions. However, the ratio remaining under 1 implies the company still carries liquidity risk to some degree, indicating that current liabilities consistently exceed highly liquid assets.

The data reveals fluctuations in total cash assets, current liabilities, and cash ratio over the examined periods. Notably, total cash assets exhibit a degree of volatility without a clear linear trend, rising and falling intermittently throughout the timeframe. Peaks in cash assets occur around June and December quarters of certain years, while troughs appear at various points, indicative of changing liquidity positions over the quarters.

Current liabilities demonstrate a somewhat cyclical pattern with periodic fluctuations. The values generally range between approximately 13,500 and 18,000 million US dollars, with some quarters showing notable increases, such as in late 2022 and early 2023. Despite these fluctuations, the liabilities do not follow a clear upward or downward trend but rather vary quarter to quarter.

The cash ratio, representing the ability to cover current liabilities with cash assets, moves in a correlated fashion with cash assets and liabilities. The ratio mostly remains below 0.4, indicating a conservative level of cash relative to short-term liabilities. Periods with higher cash ratios coincide with higher total cash assets or lower current liabilities, such as in the quarters ending March 2024, June 2024, and December 2024. Conversely, lower ratios align with quarters where either cash assets decreased or liabilities increased.

Total Cash Assets

Exhibit intermittent increases and decreases with no sustained upward or downward trend. Highest observed values surpass 5,000 million US dollars in several recent quarters, signifying some improvement in liquidity in later periods.

Current Liabilities

Display moderate volatility with occasional peaks but generally remain within a defined range suggesting stable short-term obligations amid varying business conditions.

Cash Ratio

Fluctuates between 0.2 and 0.4, reflecting consistent but moderate ability to cover short-term liabilities with available cash. The ratio trends higher in recent quarters, indicating a relative improvement in liquidity position.

Overall, the financial profile as represented by these three metrics suggests active management of cash and liabilities with short-term liquidity maintained within conservative bounds, adjusting dynamically to operational and market conditions across the analyzed quarters.