Analysis of Liquidity Ratios
Quarterly Data
Liquidity ratios measure the company ability to meet its short-term obligations.
Liquidity Ratios (Summary)
Monsanto Co., liquidity ratios (quarterly data)
Based on: 10-Q (reporting date: 2018-02-28), 10-Q (reporting date: 2017-11-30), 10-K (reporting date: 2017-08-31), 10-Q (reporting date: 2017-05-31), 10-Q (reporting date: 2017-02-28), 10-Q (reporting date: 2016-11-30), 10-K (reporting date: 2016-08-31), 10-Q (reporting date: 2016-05-31), 10-Q (reporting date: 2016-02-29), 10-Q (reporting date: 2015-11-30), 10-K (reporting date: 2015-08-31), 10-Q (reporting date: 2015-05-31), 10-Q (reporting date: 2015-02-28), 10-Q (reporting date: 2014-11-30), 10-K (reporting date: 2014-08-31), 10-Q (reporting date: 2014-05-31), 10-Q (reporting date: 2014-02-28), 10-Q (reporting date: 2013-11-30), 10-K (reporting date: 2013-08-31), 10-Q (reporting date: 2013-05-31), 10-Q (reporting date: 2013-02-28), 10-Q (reporting date: 2012-11-30), 10-K (reporting date: 2012-08-31), 10-Q (reporting date: 2012-05-31), 10-Q (reporting date: 2012-02-29), 10-Q (reporting date: 2011-11-30).
- Current Ratio
- The current ratio demonstrated an overall declining trend from November 2011 through February 2018. Initially, the ratio rose from 1.66 to a peak of 2.92 in May 2013, indicating an improvement in short-term liquidity during the earlier periods. After this peak, the ratio fluctuated downward, reaching lows near 1.21 in August 2016. Subsequently, it showed minor recovery but remained below the earlier highs, ending at 1.41 in February 2018. This pattern suggests a gradual reduction in current assets relative to current liabilities over the period, potentially signaling tighter short-term financial conditions.
- Quick Ratio
- The quick ratio followed a similar but more pronounced downward trajectory compared to the current ratio. Starting at 1.02 in November 2011, it increased to a high of 1.96 in May 2013, reflecting strong liquid assets excluding inventories. However, after this peak, the quick ratio experienced a marked decline, reaching a low of 0.60 in February 2016. While some recovery occurred afterward, the ratio remained under 1.0 through much of the latter periods, ending at 0.80 in February 2018. This downward movement indicates diminishing liquid assets available to cover current liabilities, which may imply increased reliance on inventory or a tightening in liquid asset availability.
- Cash Ratio
- The cash ratio showed considerable volatility and an overall decreasing trend over the analyzed periods. Initial values fluctuated between 0.47 and 1.01 through early 2013 but predominantly trended downward subsequently. It declined sharply from 0.72 in August 2015 to a low of 0.18 in February 2016, indicating reduced cash and cash equivalents relative to current liabilities. While moderate improvements were seen toward the end of the period, with values around 0.34 in February 2018, the ratio did not return to earlier levels. This trend suggests a considerable tightening in the most liquid assets available, potentially impacting the company's ability to immediately cover current obligations with cash.
Current Ratio
Monsanto Co., current ratio calculation (quarterly data)
| Feb 28, 2018 | Nov 30, 2017 | Aug 31, 2017 | May 31, 2017 | Feb 28, 2017 | Nov 30, 2016 | Aug 31, 2016 | May 31, 2016 | Feb 29, 2016 | Nov 30, 2015 | Aug 31, 2015 | May 31, 2015 | Feb 28, 2015 | Nov 30, 2014 | Aug 31, 2014 | May 31, 2014 | Feb 28, 2014 | Nov 30, 2013 | Aug 31, 2013 | May 31, 2013 | Feb 28, 2013 | Nov 30, 2012 | Aug 31, 2012 | May 31, 2012 | Feb 29, 2012 | Nov 30, 2011 | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||||||||||
| Current assets | 10,056) | 10,560) | 8,651) | 10,018) | 9,882) | 9,652) | 8,157) | 9,055) | 8,483) | 10,467) | 10,625) | 10,589) | 10,699) | 11,398) | 9,675) | 11,237) | 11,550) | 12,496) | 10,077) | 11,141) | 11,534) | 12,060) | 9,658) | 9,783) | 10,024) | 9,734) | ||||||||
| Current liabilities | 7,149) | 8,258) | 6,398) | 6,958) | 7,289) | 7,500) | 6,729) | 6,180) | 5,939) | 8,501) | 5,177) | 4,097) | 5,472) | 6,999) | 5,112) | 3,931) | 5,051) | 6,698) | 4,336) | 3,814) | 4,709) | 6,161) | 4,221) | 4,282) | 5,193) | 5,853) | ||||||||
| Liquidity Ratio | ||||||||||||||||||||||||||||||||||
| Current ratio1 | 1.41 | 1.28 | 1.35 | 1.44 | 1.36 | 1.29 | 1.21 | 1.47 | 1.43 | 1.23 | 2.05 | 2.58 | 1.96 | 1.63 | 1.89 | 2.86 | 2.29 | 1.87 | 2.32 | 2.92 | 2.45 | 1.96 | 2.29 | 2.28 | 1.93 | 1.66 | ||||||||
| Benchmarks | ||||||||||||||||||||||||||||||||||
| Current Ratio, Competitors2 | ||||||||||||||||||||||||||||||||||
| lululemon athletica inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Nike Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
Based on: 10-Q (reporting date: 2018-02-28), 10-Q (reporting date: 2017-11-30), 10-K (reporting date: 2017-08-31), 10-Q (reporting date: 2017-05-31), 10-Q (reporting date: 2017-02-28), 10-Q (reporting date: 2016-11-30), 10-K (reporting date: 2016-08-31), 10-Q (reporting date: 2016-05-31), 10-Q (reporting date: 2016-02-29), 10-Q (reporting date: 2015-11-30), 10-K (reporting date: 2015-08-31), 10-Q (reporting date: 2015-05-31), 10-Q (reporting date: 2015-02-28), 10-Q (reporting date: 2014-11-30), 10-K (reporting date: 2014-08-31), 10-Q (reporting date: 2014-05-31), 10-Q (reporting date: 2014-02-28), 10-Q (reporting date: 2013-11-30), 10-K (reporting date: 2013-08-31), 10-Q (reporting date: 2013-05-31), 10-Q (reporting date: 2013-02-28), 10-Q (reporting date: 2012-11-30), 10-K (reporting date: 2012-08-31), 10-Q (reporting date: 2012-05-31), 10-Q (reporting date: 2012-02-29), 10-Q (reporting date: 2011-11-30).
1 Q2 2018 Calculation
Current ratio = Current assets ÷ Current liabilities
= 10,056 ÷ 7,149 = 1.41
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals evolving patterns in the liquidity position over the observed periods.
- Current Assets
- Current assets showed fluctuations throughout the quarters, reaching notable peaks around November 2012 and November 2013, with values of approximately US$12,060 million and US$12,496 million, respectively. Afterward, a downward trend is noticeable, with figures generally declining, particularly from November 2015 onwards, experiencing a trough near August 2016 at about US$8,157 million. Towards the end of the period, current assets showed some recovery but remained below earlier peaks, ending near US$10,056 million by February 2018.
- Current Liabilities
- Current liabilities mirrored a somewhat erratic pattern with initial declines until around May 2012, where values were near US$4,282 million. Subsequently, liabilities increased sharply, peaking several times around November 2012, November 2013, and November 2015, the highest being close to US$8,501 million around November 2015. In later quarters, liabilities remained elevated, consistently exceeding US$6,000 million, suggesting increased short-term obligations in the latter part of the timeline.
- Current Ratio
- The current ratio, representing liquidity, displayed substantial variability. Initially, it exhibited a strong upward trajectory, rising from 1.66 to a high of 2.92 by May 2013, indicating improved coverage of current liabilities by current assets. Post this peak, the ratio declined sharply, dropping below 1.5 after November 2015, reflecting weakened short-term liquidity. By February 2018, the ratio stabilized around 1.41, suggesting a moderate liquidity position but significantly lower than earlier peak levels.
Overall, the data indicates a period of strengthening liquidity until mid-2013, followed by increased volatility and a more constrained liquidity environment from late 2015 onward. The decreasing trend in current assets alongside rising current liabilities contributed to the decline in the current ratio, signaling heightened attention to short-term financial management may have been necessary during the latter periods.
Quick Ratio
Monsanto Co., quick ratio calculation (quarterly data)
| Feb 28, 2018 | Nov 30, 2017 | Aug 31, 2017 | May 31, 2017 | Feb 28, 2017 | Nov 30, 2016 | Aug 31, 2016 | May 31, 2016 | Feb 29, 2016 | Nov 30, 2015 | Aug 31, 2015 | May 31, 2015 | Feb 28, 2015 | Nov 30, 2014 | Aug 31, 2014 | May 31, 2014 | Feb 28, 2014 | Nov 30, 2013 | Aug 31, 2013 | May 31, 2013 | Feb 28, 2013 | Nov 30, 2012 | Aug 31, 2012 | May 31, 2012 | Feb 29, 2012 | Nov 30, 2011 | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||||||||||
| Cash and cash equivalents | 2,409) | 3,102) | 1,856) | 1,614) | 2,281) | 2,129) | 1,676) | 1,205) | 1,050) | 2,277) | 3,701) | 1,179) | 2,732) | 3,136) | 2,367) | 1,898) | 3,805) | 4,496) | 3,668) | 2,921) | 4,443) | 4,637) | 3,283) | 1,716) | 3,123) | 3,007) | ||||||||
| Short-term investments | —) | —) | 8) | 6) | 10) | 60) | 60) | 11) | 12) | 47) | 47) | 28) | —) | 40) | 40) | —) | 45) | 249) | 254) | 143) | 310) | 310) | 302) | 302) | 302) | 302) | ||||||||
| Trade receivables, net | 2,520) | 2,115) | 2,161) | 3,913) | 2,605) | 2,196) | 1,926) | 3,168) | 1,828) | 2,106) | 1,636) | 3,998) | 2,357) | 2,247) | 2,014) | 4,229) | 2,515) | 2,283) | 1,715) | 3,610) | 2,219) | 2,168) | 1,897) | 3,727) | 2,341) | 1,993) | ||||||||
| Miscellaneous receivables | 772) | 987) | 827) | 763) | 772) | 917) | 755) | 744) | 699) | 1,000) | 803) | 877) | 711) | 870) | 817) | 803) | 668) | 774) | 748) | 812) | 638) | 700) | 620) | 674) | 661) | 639) | ||||||||
| Total quick assets | 5,701) | 6,204) | 4,852) | 6,296) | 5,668) | 5,302) | 4,417) | 5,128) | 3,589) | 5,430) | 6,187) | 6,082) | 5,800) | 6,293) | 5,238) | 6,930) | 7,033) | 7,802) | 6,385) | 7,486) | 7,610) | 7,815) | 6,102) | 6,419) | 6,427) | 5,941) | ||||||||
| Current liabilities | 7,149) | 8,258) | 6,398) | 6,958) | 7,289) | 7,500) | 6,729) | 6,180) | 5,939) | 8,501) | 5,177) | 4,097) | 5,472) | 6,999) | 5,112) | 3,931) | 5,051) | 6,698) | 4,336) | 3,814) | 4,709) | 6,161) | 4,221) | 4,282) | 5,193) | 5,853) | ||||||||
| Liquidity Ratio | ||||||||||||||||||||||||||||||||||
| Quick ratio1 | 0.80 | 0.75 | 0.76 | 0.90 | 0.78 | 0.71 | 0.66 | 0.83 | 0.60 | 0.64 | 1.20 | 1.48 | 1.06 | 0.90 | 1.02 | 1.76 | 1.39 | 1.16 | 1.47 | 1.96 | 1.62 | 1.27 | 1.45 | 1.50 | 1.24 | 1.02 | ||||||||
| Benchmarks | ||||||||||||||||||||||||||||||||||
| Quick Ratio, Competitors2 | ||||||||||||||||||||||||||||||||||
| lululemon athletica inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Nike Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
Based on: 10-Q (reporting date: 2018-02-28), 10-Q (reporting date: 2017-11-30), 10-K (reporting date: 2017-08-31), 10-Q (reporting date: 2017-05-31), 10-Q (reporting date: 2017-02-28), 10-Q (reporting date: 2016-11-30), 10-K (reporting date: 2016-08-31), 10-Q (reporting date: 2016-05-31), 10-Q (reporting date: 2016-02-29), 10-Q (reporting date: 2015-11-30), 10-K (reporting date: 2015-08-31), 10-Q (reporting date: 2015-05-31), 10-Q (reporting date: 2015-02-28), 10-Q (reporting date: 2014-11-30), 10-K (reporting date: 2014-08-31), 10-Q (reporting date: 2014-05-31), 10-Q (reporting date: 2014-02-28), 10-Q (reporting date: 2013-11-30), 10-K (reporting date: 2013-08-31), 10-Q (reporting date: 2013-05-31), 10-Q (reporting date: 2013-02-28), 10-Q (reporting date: 2012-11-30), 10-K (reporting date: 2012-08-31), 10-Q (reporting date: 2012-05-31), 10-Q (reporting date: 2012-02-29), 10-Q (reporting date: 2011-11-30).
1 Q2 2018 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= 5,701 ÷ 7,149 = 0.80
2 Click competitor name to see calculations.
The financial data reveals variations in liquidity over the observed periods, primarily reflected in the changes of total quick assets, current liabilities, and the quick ratio.
- Total Quick Assets
- The total quick assets displayed fluctuations throughout the timeline. Initially, there was an increase from 5,941 million US dollars in November 2011 to a peak of about 7,815 million in November 2012. This was followed by a general decline with intermittent rebounds, reaching a notable low around February 2016 with 3,589 million US dollars. Subsequent quarters experienced moderate recovery, with values oscillating near the 5,000 to 6,000 million US dollars mark by early 2018.
- Current Liabilities
- Current liabilities demonstrated considerable volatility. Starting at 5,853 million US dollars in late 2011, liabilities reduced markedly through mid-2012. However, from November 2012 onwards, there was a marked upward trend with peaks exceeding 8,500 million US dollars by November 2015 and remaining elevated with fluctuations around 7,000 to 8,200 million in 2017 and early 2018. This suggests increased short-term obligations over time.
- Quick Ratio
- The quick ratio, a key indicator of short-term liquidity, mirrored the interplay between quick assets and current liabilities. Beginning slightly above 1.0 in late 2011, it improved to a high of 1.96 in May 2013, indicating strong liquidity. Nevertheless, from late 2014 onwards, the ratio declined significantly, reaching a low of approximately 0.6 by early 2016, reflecting tighter liquidity conditions. Subsequently, minor improvements occurred but values remained below 1.0 through early 2018, signaling continued constraints in meeting immediate liabilities without inventory sales.
Overall, the data suggests a cycle of increasing liquidity constraints commencing around late 2014 through 2016, with partial recovery thereafter but not returning to earlier levels. The rising current liabilities coupled with fluctuating quick assets negatively impacted liquidity ratios, indicating potential pressures on short-term financial stability during the later periods examined.
Cash Ratio
Monsanto Co., cash ratio calculation (quarterly data)
| Feb 28, 2018 | Nov 30, 2017 | Aug 31, 2017 | May 31, 2017 | Feb 28, 2017 | Nov 30, 2016 | Aug 31, 2016 | May 31, 2016 | Feb 29, 2016 | Nov 30, 2015 | Aug 31, 2015 | May 31, 2015 | Feb 28, 2015 | Nov 30, 2014 | Aug 31, 2014 | May 31, 2014 | Feb 28, 2014 | Nov 30, 2013 | Aug 31, 2013 | May 31, 2013 | Feb 28, 2013 | Nov 30, 2012 | Aug 31, 2012 | May 31, 2012 | Feb 29, 2012 | Nov 30, 2011 | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||||||||||
| Cash and cash equivalents | 2,409) | 3,102) | 1,856) | 1,614) | 2,281) | 2,129) | 1,676) | 1,205) | 1,050) | 2,277) | 3,701) | 1,179) | 2,732) | 3,136) | 2,367) | 1,898) | 3,805) | 4,496) | 3,668) | 2,921) | 4,443) | 4,637) | 3,283) | 1,716) | 3,123) | 3,007) | ||||||||
| Short-term investments | —) | —) | 8) | 6) | 10) | 60) | 60) | 11) | 12) | 47) | 47) | 28) | —) | 40) | 40) | —) | 45) | 249) | 254) | 143) | 310) | 310) | 302) | 302) | 302) | 302) | ||||||||
| Total cash assets | 2,409) | 3,102) | 1,864) | 1,620) | 2,291) | 2,189) | 1,736) | 1,216) | 1,062) | 2,324) | 3,748) | 1,207) | 2,732) | 3,176) | 2,407) | 1,898) | 3,850) | 4,745) | 3,922) | 3,064) | 4,753) | 4,947) | 3,585) | 2,018) | 3,425) | 3,309) | ||||||||
| Current liabilities | 7,149) | 8,258) | 6,398) | 6,958) | 7,289) | 7,500) | 6,729) | 6,180) | 5,939) | 8,501) | 5,177) | 4,097) | 5,472) | 6,999) | 5,112) | 3,931) | 5,051) | 6,698) | 4,336) | 3,814) | 4,709) | 6,161) | 4,221) | 4,282) | 5,193) | 5,853) | ||||||||
| Liquidity Ratio | ||||||||||||||||||||||||||||||||||
| Cash ratio1 | 0.34 | 0.38 | 0.29 | 0.23 | 0.31 | 0.29 | 0.26 | 0.20 | 0.18 | 0.27 | 0.72 | 0.29 | 0.50 | 0.45 | 0.47 | 0.48 | 0.76 | 0.71 | 0.90 | 0.80 | 1.01 | 0.80 | 0.85 | 0.47 | 0.66 | 0.57 | ||||||||
| Benchmarks | ||||||||||||||||||||||||||||||||||
| Cash Ratio, Competitors2 | ||||||||||||||||||||||||||||||||||
| lululemon athletica inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Nike Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
Based on: 10-Q (reporting date: 2018-02-28), 10-Q (reporting date: 2017-11-30), 10-K (reporting date: 2017-08-31), 10-Q (reporting date: 2017-05-31), 10-Q (reporting date: 2017-02-28), 10-Q (reporting date: 2016-11-30), 10-K (reporting date: 2016-08-31), 10-Q (reporting date: 2016-05-31), 10-Q (reporting date: 2016-02-29), 10-Q (reporting date: 2015-11-30), 10-K (reporting date: 2015-08-31), 10-Q (reporting date: 2015-05-31), 10-Q (reporting date: 2015-02-28), 10-Q (reporting date: 2014-11-30), 10-K (reporting date: 2014-08-31), 10-Q (reporting date: 2014-05-31), 10-Q (reporting date: 2014-02-28), 10-Q (reporting date: 2013-11-30), 10-K (reporting date: 2013-08-31), 10-Q (reporting date: 2013-05-31), 10-Q (reporting date: 2013-02-28), 10-Q (reporting date: 2012-11-30), 10-K (reporting date: 2012-08-31), 10-Q (reporting date: 2012-05-31), 10-Q (reporting date: 2012-02-29), 10-Q (reporting date: 2011-11-30).
1 Q2 2018 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= 2,409 ÷ 7,149 = 0.34
2 Click competitor name to see calculations.
- Total cash assets
- The total cash assets exhibit considerable fluctuation throughout the periods analyzed. Initially, the cash position was around 3.3 billion US dollars but experienced a notable decline to approximately 2.0 billion by May 2012. This was followed by a recovery phase, with peaks observed in November 2012 and November 2013, reaching near 4.9 and 4.7 billion respectively. Subsequently, a downward trend occurred between late 2013 and mid-2015, with cash assets dropping sharply to about 1.2 billion US dollars by May 2015. After mid-2015, total cash assets displayed intermittent recovery, peaking again in August 2015 and subsequently declining and rising in a range from roughly 1.0 to 3.1 billion US dollars, ending at approximately 2.4 billion in February 2018.
- Current liabilities
- Current liabilities showed variability with a generally increasing tendency over the observed periods. Starting near 5.9 billion US dollars in late 2011, liabilities decreased to around 4.3 billion by mid-2012. This was followed by a significant rise by November 2012 to over 6.1 billion. Fluctuations continued with a tendency to increase, reaching a high point of approximately 8.5 billion by November 2015. Post this peak, liabilities fluctuated while remaining elevated, typically ranging from 6.0 to 7.5 billion, culminating at approximately 7.1 billion in early 2018.
- Cash ratio
- The cash ratio, reflecting liquidity relative to current liabilities, exhibited a declining trend over the timeline. Initially, ratios fluctuated between 0.47 and 1.01 until early 2013, indicating relatively strong liquidity positions. However, from mid-2013 onwards, the ratio generally weakened, frequently falling below 0.5 and reaching lows near 0.18 to 0.29 between early 2016 and late 2017. The final observed periods show a slight improvement towards 0.38 by early 2018, although still significantly lower compared to earlier peaks.
- Overall trends and insights
- The analysis reveals a pattern of considerable volatility in cash assets, occasionally correlating with fluctuations in current liabilities. Despite some episodes of cash asset recovery, total cash has generally struggled to maintain high levels over the years. Meanwhile, current liabilities have shown a tendency to increase, leading to pressure on liquidity as illustrated by the declining cash ratio. The lowered cash ratio in recent years suggests a potential weakening in short-term financial flexibility, indicating that the company's liquid assets are becoming relatively insufficient to cover current obligations as comprehensively as in previous periods. This trend may warrant further attention regarding liquidity management and working capital strategies.