Analysis of Liquidity Ratios
Quarterly Data
Liquidity ratios measure the company ability to meet its short-term obligations.
Liquidity Ratios (Summary)
Marathon Petroleum Corp., liquidity ratios (quarterly data)
Based on: 10-Q (reporting date: 2024-09-30), 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).
- Current Ratio
- The current ratio exhibited a general upward trend from March 2020 through June 2021, increasing from 1.16 to a peak of 2.02 by September 2021. Subsequently, it declined steadily from the December 2021 level of 1.70 to 1.23 by September 2024. This pattern suggests an initial strengthening of short-term liquidity which tapered off over the most recent periods, indicating a gradual reduction in current assets relative to current liabilities.
- Quick Ratio
- The quick ratio showed a decreasing trend in the first three quarters of 2020, falling from 0.54 to 0.39. It then surged sharply reaching a high of 1.39 in June 2021, before gradually declining thereafter. From June 2021 onwards, the quick ratio remained relatively stable around 1.20 to 1.30 until the end of 2022, followed by a continuous decline into 2024 reaching 0.73 in September 2024. This indicates a significant improvement in near-cash liquidity in mid-2021 followed by a progressive decrease, reflecting a shift in liquid assets aside from inventories.
- Cash Ratio
- The cash ratio was notably low in early 2020, dropping from 0.12 to 0.03 by December 2020. A pronounced increase occurred in the first half of 2021, peaking at 0.88 in June 2021, before experiencing a gradual decline to 0.24 by September 2024. Despite fluctuations, the cash ratio remained below 1 throughout the entire period, reflecting a cautious approach to holding cash relative to current liabilities. The peak in mid-2021 suggests a temporary strategy of bolstering highly liquid cash assets, which was later moderated in line with operational needs or investment activities.
- Overall Analysis
- The liquidity ratios collectively indicate a liquidity strengthening phase centered around mid-2021, with all ratios reaching local maxima during this period. Afterward, there is a consistent downward trend in liquidity levels across all three measures through to the third quarter of 2024. The divergence between the quick and current ratios at various points suggests changes in inventory levels and the composition of current assets. The decreasing trend in cash ratio highlights a shift away from cash holdings in favor of other asset forms or reduction in liquid reserves. The trends signal a dynamic liquidity management reflecting responses to market conditions and operational strategies over the analyzed period.
Current Ratio
Marathon Petroleum Corp., current ratio calculation (quarterly data)
| Sep 30, 2024 | 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 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||
| Current assets | 25,949) | 31,347) | 31,260) | 32,131) | 36,275) | 32,213) | 32,486) | 35,242) | 35,285) | 42,413) | 36,388) | 30,496) | 34,143) | 38,592) | 30,361) | 28,287) | 26,200) | 14,643) | 15,693) | ||||||
| Current liabilities | 21,068) | 24,000) | 21,787) | 20,150) | 21,735) | 17,466) | 17,057) | 20,020) | 21,314) | 28,437) | 25,120) | 17,898) | 16,898) | 19,512) | 16,085) | 15,663) | 14,246) | 11,504) | 13,569) | ||||||
| Liquidity Ratio | |||||||||||||||||||||||||
| Current ratio1 | 1.23 | 1.31 | 1.43 | 1.59 | 1.67 | 1.84 | 1.90 | 1.76 | 1.66 | 1.49 | 1.45 | 1.70 | 2.02 | 1.98 | 1.89 | 1.81 | 1.84 | 1.27 | 1.16 | ||||||
| Benchmarks | |||||||||||||||||||||||||
| Current Ratio, Competitors2 | |||||||||||||||||||||||||
| Chevron Corp. | 1.07 | 1.16 | 1.23 | 1.27 | 1.25 | 1.43 | 1.43 | 1.47 | 1.40 | 1.31 | 1.43 | 1.26 | 1.28 | 1.17 | 1.11 | — | — | — | — | ||||||
| ConocoPhillips | 1.30 | 1.33 | 1.35 | 1.43 | 1.66 | 1.41 | 1.39 | 1.46 | 1.46 | 1.54 | 1.51 | 1.34 | 1.93 | 2.11 | 2.03 | — | — | — | — | ||||||
| Exxon Mobil Corp. | 1.35 | 1.36 | 1.38 | 1.48 | 1.42 | 1.48 | 1.46 | 1.41 | 1.34 | 1.16 | 1.07 | 1.04 | 0.90 | 0.85 | 0.80 | — | — | — | — | ||||||
Based on: 10-Q (reporting date: 2024-09-30), 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).
1 Q3 2024 Calculation
Current ratio = Current assets ÷ Current liabilities
= 25,949 ÷ 21,068 = 1.23
2 Click competitor name to see calculations.
- Current Assets Trend
- The current assets exhibit considerable fluctuation across the periods. Starting at $15,693 million, the figures increase sharply to a peak of approximately $42,413 million by June 2022. Following this peak, a general declining trend is observed, with current assets falling to around $25,949 million by September 2024. This indicates periods of significant asset accumulation followed by a sustained drawdown.
- Current Liabilities Trend
- Current liabilities present a somewhat similar volatility pattern. Beginning at $13,569 million, liabilities rise steadily to a high of $28,437 million in June 2022. After this point, liabilities generally decrease but with some fluctuations, settling at approximately $21,068 million in September 2024. The peaks in liabilities closely mirror those seen in current assets, suggesting correlated changes in working capital components.
- Current Ratio Analysis
- The current ratio indicates the company's short-term liquidity position. Initially, the ratio improves from 1.16 to a high of approximately 2.02 in September 2021, reflecting an improved capacity to cover short-term obligations with current assets. However, from late 2021 onward, the ratio declines consistently, reaching 1.23 by September 2024. This downward trend suggests a weakening liquidity position over recent periods, which may merit attention for working capital management.
- Summary of Financial Position Dynamics
- Overall, the data reflects a cycle of asset and liability accumulation through mid-2022, followed by a contraction phase. The initial increase in current assets and liabilities, along with a rising current ratio, indicates a period of expanding operations or inventory buildup. Subsequently, the declining current ratio combined with reductions in both assets and liabilities suggests a tightening liquidity scenario or potential inventory and receivables reduction. The recent current ratios, although above 1.0, show a downward trend that could indicate increasing liquidity risk if the trend continues.
Quick Ratio
Marathon Petroleum Corp., quick ratio calculation (quarterly data)
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||
| Cash and cash equivalents | 4,002) | 4,441) | 3,175) | 5,443) | 8,452) | 7,345) | 7,960) | 8,625) | 7,376) | 9,078) | 7,148) | 5,291) | 5,874) | 11,839) | 624) | 415) | 618) | 1,091) | 1,690) | ||||||
| Short-term investments | 1,141) | 4,058) | 4,399) | 4,781) | 4,604) | 4,109) | 3,492) | 3,145) | 3,759) | 4,241) | 3,449) | 5,548) | 7,352) | 5,418) | —) | —) | —) | —) | —) | ||||||
| Receivables, less allowance for doubtful accounts | 10,180) | 12,307) | 13,171) | 11,619) | 12,469) | 10,274) | 10,143) | 13,477) | 13,458) | 17,305) | 15,661) | 11,034) | 9,511) | 9,771) | 7,468) | 5,760) | 4,911) | 4,361) | 5,583) | ||||||
| Total quick assets | 15,323) | 20,806) | 20,745) | 21,843) | 25,525) | 21,728) | 21,595) | 25,247) | 24,593) | 30,624) | 26,258) | 21,873) | 22,737) | 27,028) | 8,092) | 6,175) | 5,529) | 5,452) | 7,273) | ||||||
| Current liabilities | 21,068) | 24,000) | 21,787) | 20,150) | 21,735) | 17,466) | 17,057) | 20,020) | 21,314) | 28,437) | 25,120) | 17,898) | 16,898) | 19,512) | 16,085) | 15,663) | 14,246) | 11,504) | 13,569) | ||||||
| Liquidity Ratio | |||||||||||||||||||||||||
| Quick ratio1 | 0.73 | 0.87 | 0.95 | 1.08 | 1.17 | 1.24 | 1.27 | 1.26 | 1.15 | 1.08 | 1.05 | 1.22 | 1.35 | 1.39 | 0.50 | 0.39 | 0.39 | 0.47 | 0.54 | ||||||
| Benchmarks | |||||||||||||||||||||||||
| Quick Ratio, Competitors2 | |||||||||||||||||||||||||
| Chevron Corp. | 0.68 | 0.73 | 0.81 | 0.87 | 0.84 | 0.97 | 1.03 | 1.12 | 1.03 | 1.00 | 1.12 | 0.90 | 0.90 | 0.83 | 0.77 | — | — | — | — | ||||||
| ConocoPhillips | 1.08 | 1.10 | 1.13 | 1.21 | 1.46 | 1.19 | 1.20 | 1.27 | 1.27 | 1.34 | 1.29 | 1.10 | 1.66 | 1.86 | 1.81 | — | — | — | — | ||||||
| Exxon Mobil Corp. | 0.98 | 0.98 | 1.02 | 1.06 | 1.05 | 1.06 | 1.07 | 1.03 | 0.98 | 0.84 | 0.74 | 0.69 | 0.55 | 0.51 | 0.47 | — | — | — | — | ||||||
Based on: 10-Q (reporting date: 2024-09-30), 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).
1 Q3 2024 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= 15,323 ÷ 21,068 = 0.73
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals significant fluctuations in the liquidity position over the observed periods.
- Total Quick Assets
- The total quick assets exhibited notable volatility. Initially, from March 2020 to March 2021, the values ranged from approximately 5,452 to 8,092 million USD, indicating a moderate increase. A substantial surge occurred in the second quarter of 2021, peaking around 27,028 million USD. This elevated level was partly sustained until the end of 2021 before decreasing to around 21,595 million USD by March 2023. Subsequent quarters displayed additional variability with levels mostly fluctuating between approximately 15,323 and 25,525 million USD through the end of the observed timeline.
- Current Liabilities
- Current liabilities followed a generally upward trajectory from March 2020 through June 2022, rising from around 11,504 million USD to a high of about 28,437 million USD. After this peak, liabilities showed a decreasing trend until the end of 2022, falling to roughly 17,057 million USD. However, from early 2023 onward, current liabilities again increased, reaching near 24,000 million USD at different points, although with a slight decline towards the end of the period to approximately 21,068 million USD.
- Quick Ratio
- The quick ratio, indicating the company's short-term liquidity, initially exhibited a declining pattern from 0.54 in the first quarter of 2020 to 0.39 by the end of that year, reflecting weakening liquidity relative to current liabilities. A pronounced improvement occurred in 2021, with the ratio rising sharply to a peak of 1.39 in the second quarter, suggesting a strong liquidity position during this period. Thereafter, the quick ratio demonstrated a gradual decline, falling below 1.0 by mid-2023 and continuing to decrease to 0.73 by the third quarter of 2024. This downward trend indicates diminishing liquid asset coverage relative to current liabilities over the most recent periods.
In summary, the liquidity position improved dramatically in mid-2021 but gradually weakened thereafter. The total quick assets and current liabilities both showed significant variability, with liabilities generally trending higher over the longer term, contributing to the decline in the quick ratio observed toward the end of the data series. This suggests increasing pressure on short-term liquidity in the latest quarters analyzed.
Cash Ratio
Marathon Petroleum Corp., cash ratio calculation (quarterly data)
| Sep 30, 2024 | 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 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||
| Cash and cash equivalents | 4,002) | 4,441) | 3,175) | 5,443) | 8,452) | 7,345) | 7,960) | 8,625) | 7,376) | 9,078) | 7,148) | 5,291) | 5,874) | 11,839) | 624) | 415) | 618) | 1,091) | 1,690) | ||||||
| Short-term investments | 1,141) | 4,058) | 4,399) | 4,781) | 4,604) | 4,109) | 3,492) | 3,145) | 3,759) | 4,241) | 3,449) | 5,548) | 7,352) | 5,418) | —) | —) | —) | —) | —) | ||||||
| Total cash assets | 5,143) | 8,499) | 7,574) | 10,224) | 13,056) | 11,454) | 11,452) | 11,770) | 11,135) | 13,319) | 10,597) | 10,839) | 13,226) | 17,257) | 624) | 415) | 618) | 1,091) | 1,690) | ||||||
| Current liabilities | 21,068) | 24,000) | 21,787) | 20,150) | 21,735) | 17,466) | 17,057) | 20,020) | 21,314) | 28,437) | 25,120) | 17,898) | 16,898) | 19,512) | 16,085) | 15,663) | 14,246) | 11,504) | 13,569) | ||||||
| Liquidity Ratio | |||||||||||||||||||||||||
| Cash ratio1 | 0.24 | 0.35 | 0.35 | 0.51 | 0.60 | 0.66 | 0.67 | 0.59 | 0.52 | 0.47 | 0.42 | 0.61 | 0.78 | 0.88 | 0.04 | 0.03 | 0.04 | 0.09 | 0.12 | ||||||
| Benchmarks | |||||||||||||||||||||||||
| Cash Ratio, Competitors2 | |||||||||||||||||||||||||
| Chevron Corp. | 0.13 | 0.12 | 0.19 | 0.25 | 0.18 | 0.32 | 0.47 | 0.52 | 0.42 | 0.32 | 0.38 | 0.21 | 0.24 | 0.27 | 0.26 | — | — | — | — | ||||||
| ConocoPhillips | 0.63 | 0.58 | 0.60 | 0.66 | 0.91 | 0.71 | 0.75 | 0.72 | 0.74 | 0.67 | 0.61 | 0.55 | 1.14 | 1.31 | 1.18 | — | — | — | — | ||||||
| Exxon Mobil Corp. | 0.39 | 0.37 | 0.46 | 0.48 | 0.46 | 0.48 | 0.49 | 0.43 | 0.41 | 0.24 | 0.15 | 0.12 | 0.08 | 0.06 | 0.06 | — | — | — | — | ||||||
Based on: 10-Q (reporting date: 2024-09-30), 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).
1 Q3 2024 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= 5,143 ÷ 21,068 = 0.24
2 Click competitor name to see calculations.
- Cash Assets Trend
- There is a notable fluctuation in total cash assets over the analyzed periods. Initially, cash assets declined significantly from 1,690 million USD in Q1 2020 to a low of 415 million USD by Q4 2020. This was followed by a sharp increase peaking at 17,257 million USD in Q2 2021. After this peak, cash assets generally trended downward with intermittent recoveries, ending at 5,143 million USD by Q1 2024, showing a substantial reduction from the peak value.
- Current Liabilities Movement
- Current liabilities demonstrated an overall upward trajectory. Beginning at 13,569 million USD in Q1 2020, liabilities fluctuated but showed an increasing pattern that reached a high of 28,437 million USD in Q2 2022. Following this peak, liabilities slightly decreased but remained elevated, ending at 21,068 million USD in Q1 2024. This indicates increased short-term obligations over the period.
- Cash Ratio Analysis
- The cash ratio, representing the company's liquidity position, exhibited significant variation. Initially very low at 0.12 in Q1 2020 and bottoming out at 0.03 in Q4 2020, it then surged to 0.88 by Q2 2021 concurrent with the peak in cash assets. Subsequently, the ratio declined gradually, with values hovering around 0.6 to 0.7 through 2022 and 2023, then falling further to 0.24 by Q1 2024, pointing to a deterioration in liquidity relative to current liabilities.
- Overall Observations
- The period reflects high volatility in cash holdings and liquidity. The sharp increase in cash assets and cash ratio in mid-2021 suggests a temporary liquidity strengthening, which was not sustained. Current liabilities increased overall, indicating escalating short-term financial commitments. The gradual decline in the cash ratio in the later quarters signals potential pressure on liquidity and a need for careful cash management going forward.