Medtronic PLC (NYSE:MDT)

Current ratio

The current ratio exhibited variability over the analyzed periods, starting at 2.13 in 2020 and increasing to a peak of 2.65 in 2021. Subsequently, it declined sharply to 1.86 in 2022, followed by a recovery to 2.39 in 2023. The ratio then declined again in the last two periods, finishing at 1.85 in 2025. Overall, there is a fluctuating trend with no consistent direction, indicating changes in the company's ability to cover short-term liabilities with current assets.

Quick ratio

The quick ratio showed a peak of 1.91 in 2021, preceded by 1.5 in 2020. This was followed by a decline to 1.3 in 2022, a slight recovery to 1.54 in 2023, and a gradual decrease thereafter to 1.2 by 2025. The trend mirrors the movements seen in the current ratio, but at generally lower levels, suggesting a moderate capacity to cover immediate liabilities without relying on inventory.

Cash ratio

The cash ratio displayed a declining trend over the entire period. Starting at 1.06 in 2020, it increased to 1.27 in 2021 but then steadily decreased each year to 0.7 in 2025. This indicates a gradual reduction in the company's cash and cash equivalents relative to current liabilities, potentially signaling reduced liquidity buffer from cash assets alone.

The financial data over the reviewed periods indicates notable fluctuations in liquidity and working capital management. The evaluation focuses on current assets, current liabilities, and the current ratio, revealing underlying trends impacting short-term financial stability.

Current Assets

Current assets show a generally stable pattern with slight variations across the years. Starting at 22,031 million US dollars in April 2020, the value increased gradually to 23,059 million in April 2022. This was followed by a decline to 21,675 million in April 2023, before rising again to 23,814 million projected for April 2025. The fluctuations suggest periodic adjustments in liquid and near-liquid assets, reflecting possible responses to operational needs or market conditions.

Current Liabilities

The current liabilities exhibit more pronounced variability. Initially at 10,366 million US dollars in April 2020, there was a decrease to 8,509 million in April 2021, likely indicating improved short-term debt reduction or payables management. However, liabilities then surged to 12,394 million in April 2022, followed by a fall to 9,051 million in April 2023. A subsequent increase is noted up to 12,879 million anticipated by April 2025. This pattern reflects volatility in short-term obligations, which may be influenced by factors such as financing strategies or changes in operational scale.

Current Ratio

The current ratio, a key indicator of liquidity, experienced fluctuations aligning with changes in assets and liabilities. It rose from 2.13 in April 2020 to a peak of 2.65 in April 2021, suggesting enhanced capacity to cover short-term liabilities at that time. Subsequently, the ratio declined to 1.86 in April 2022, indicating reduced liquidity, then partially recovered to 2.39 in April 2023. The projected ratio decreases again to 1.85 by April 2025, signaling a potential tightening of short-term financial strength despite the increase in current assets. This dip below 2.0 in the later periods could reflect higher current liabilities relative to assets, necessitating cautious liquidity management.

Overall, the data illustrates a dynamic environment for managing current financial resources, with periodic tightening and easing of liquidity. The fluctuations in the current ratio suggest the company may need to monitor its short-term liabilities closely to maintain a robust financial position. The rising trend in current liabilities toward the end of the period, juxtaposed with less relative growth in current assets, highlights the importance of continued focus on working capital optimization.

Total quick assets

The value of total quick assets shows fluctuation over the six-year period. Starting at 15,593 million US dollars in 2020, the figure increased to a peak of 16,279 million in 2021. Subsequently, it declined steadily to reach 13,957 million by 2023. Following this decline, there was a moderate recovery with values rising to 14,133 million in 2024 and further up to 15,480 million in 2025. Overall, the trend indicates some volatility with an initial growth phase, a mid-period decline, and a partial rebound in later years.

Current liabilities

Current liabilities experienced notable variability throughout the period. The amount was 10,366 million US dollars in 2020 and decreased significantly to 8,509 million in 2021. However, there was a sharp increase to 12,394 million in 2022, followed by a decline to 9,051 million in 2023. Lastly, liabilities rose again in the subsequent two years to reach 10,789 million in 2024 and 12,879 million in 2025. These fluctuations suggest swings in short-term obligations, reflecting possible changes in operational or financing activities.

Quick ratio

The quick ratio exhibited a pattern of decline over the analyzed period, indicating decreasing liquidity relative to short-term liabilities. It started at a ratio of 1.5 in 2020 and increased to its highest point of 1.91 in 2021, suggesting strong short-term financial health at that time. From 2021 onwards, the ratio declined progressively to 1.3 in 2022, then increased slightly to 1.54 in 2023, followed by decreases to 1.31 in 2024 and 1.2 in 2025. This downward trend implies that the company's ability to cover current liabilities with quick assets weakened somewhat in recent years despite some temporary improvement.

Total cash assets

The total cash assets show a general decline from US$10,948 million in April 2020 to US$7,959 million in April 2023. Following this decrease, there is an upward trend observed in the subsequent years, with cash assets increasing slightly to US$8,005 million in April 2024 and further to US$8,965 million in April 2025. This indicates a recovery in cash holdings after a significant reduction in the early years.

Current liabilities

The current liabilities exhibit considerable fluctuations during the period. There was a decrease from US$10,366 million in April 2020 to US$8,509 million in April 2021, followed by a sharp increase to US$12,394 million in April 2022. This peak is succeeded by a decline to US$9,051 million in April 2023, then a rise again to US$10,789 million in April 2024, and further to US$12,879 million in April 2025. These movements suggest varying short-term financial obligations with no consistent trend over the period examined.

Cash ratio

The cash ratio, which measures liquidity by comparing cash to current liabilities, starts at 1.06 in April 2020, improving to a peak of 1.27 in April 2021. After this peak, the ratio declines steadily to 0.85 in April 2022, then remains relatively stable around 0.88 in April 2023 before decreasing further to 0.74 in April 2024 and 0.7 in April 2025. The downward trajectory suggests a reduction in the company's liquidity position relative to its short-term obligations over the later years.