Liquidity ratios measure the company ability to meet its short-term obligations.
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- Balance Sheet: Liabilities and Stockholders’ Equity
- Common-Size Balance Sheet: Assets
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Solvency Ratios
- Analysis of Short-term (Operating) Activity Ratios
- Analysis of Geographic Areas
- Common Stock Valuation Ratios
- Enterprise Value to FCFF (EV/FCFF)
- Price to Book Value (P/BV) since 2008
- Analysis of Revenues
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Liquidity Ratios (Summary)
Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
---|---|---|---|---|---|---|
Current ratio | ||||||
Quick ratio | ||||||
Cash ratio |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
- Current Ratio
- The current ratio demonstrates a declining trend from 1.1 in 2020 to a low of 0.72 in 2022, indicating a reduction in the company's short-term liquidity during this period. Although there is a modest recovery in 2023 and 2024, with ratios increasing to 0.75 and 0.88 respectively, the values remain below 1, suggesting that current liabilities continue to exceed current assets and the liquidity position is somewhat constrained.
- Quick Ratio
- The quick ratio also shows a consistent decrease over the five-year span, dropping from 0.56 in 2020 to a minimum of 0.28 in 2023. This measure, which excludes inventory from current assets, points to weakening immediate liquidity and potential challenges in covering short-term liabilities without relying on inventory sales. The slight improvement to 0.39 in 2024 indicates a marginal enhancement but still reflects a relatively tight liquidity situation.
- Cash Ratio
- The cash ratio exhibits a notable decline from 0.37 in 2020 to 0.12 in both 2022 and 2023, illustrating a significant reduction in the company's most liquid assets relative to current liabilities. Although there is a recovery to 0.18 in 2024, this ratio remains low, indicating limited cash reserves to meet immediate obligations without converting other assets.
- Overall Liquidity Assessment
- The overall liquidity position of the company has weakened notably between 2020 and 2023 across all three ratios, with some recovery in 2024. The persistent sub-1 current and quick ratios, coupled with low cash ratios, suggest the company may face challenges in meeting short-term liabilities purely with readily available assets, highlighting a potential area for financial management focus.
Current Ratio
Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
---|---|---|---|---|---|---|
Selected Financial Data (US$ in millions) | ||||||
Current assets | ||||||
Current liabilities | ||||||
Liquidity Ratio | ||||||
Current ratio1 | ||||||
Benchmarks | ||||||
Current Ratio, Competitors2 | ||||||
Coca-Cola Co. | ||||||
Mondelēz International Inc. | ||||||
PepsiCo Inc. | ||||||
Current Ratio, Sector | ||||||
Food, Beverage & Tobacco | ||||||
Current Ratio, Industry | ||||||
Consumer Staples |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Current ratio = Current assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
The financial data over the five-year period reveals discernible trends in liquidity and current asset/liability management. An analysis of these trends provides insight into the company's short-term financial health and operational efficiency.
- Current Assets
- Current assets experienced a decline from 21,492 million US$ in 2020 to 17,717 million US$ in 2021, representing a significant reduction. This was followed by a partial recovery in subsequent years, rising to 19,619 million US$ in 2022, and further to 19,755 million US$ in 2023, with a slight increase to 20,170 million US$ in 2024. Overall, after an initial drop, current assets showed a moderate upward trend toward stabilization.
- Current Liabilities
- Current liabilities demonstrate a contrasting pattern with relatively stable figures in 2020 and 2021 at approximately 19,615 million US$ and 19,255 million US$, respectively. However, there was a sharp increase in 2022 to 27,336 million US$, peaking markedly higher than previous years. This elevated level, though slightly reduced in 2023 to 26,383 million US$, still remained substantially above the 2020-2021 baseline. By 2024, current liabilities decreased further to 22,915 million US$, yet stayed elevated compared to the initial years.
- Current Ratio
- The current ratio, an indicator of liquidity, declined steadily from 1.1 in 2020 to a low of 0.72 in 2022. This reflects a shift from a relatively comfortable liquidity position to one where current liabilities exceeded current assets significantly. There was a modest improvement in the following years, with the ratio increasing to 0.75 in 2023 and further to 0.88 in 2024. Despite this recovery, the ratio remained below the 1.0 threshold, signaling potential short-term liquidity challenges.
In summary, the data reveals an initial erosion of current assets in 2021, followed by stabilization. Meanwhile, a substantial increase in current liabilities during 2022 led to pressure on liquidity as indicated by the low current ratios. Although recent years show some improvements, the current ratio remains below 1.0, indicating ongoing attention is necessary to manage short-term obligations effectively and ensure liquidity risk is controlled.
Quick Ratio
Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
---|---|---|---|---|---|---|
Selected Financial Data (US$ in millions) | ||||||
Cash and cash equivalents | ||||||
Trade receivables, less allowances | ||||||
Other receivables, less allowances | ||||||
Total quick assets | ||||||
Current liabilities | ||||||
Liquidity Ratio | ||||||
Quick ratio1 | ||||||
Benchmarks | ||||||
Quick Ratio, Competitors2 | ||||||
Coca-Cola Co. | ||||||
Mondelēz International Inc. | ||||||
PepsiCo Inc. | ||||||
Quick Ratio, Sector | ||||||
Food, Beverage & Tobacco | ||||||
Quick Ratio, Industry | ||||||
Consumer Staples |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
The analysis of the financial data over the five-year period reveals notable trends in liquidity and short-term financial health.
- Total quick assets
- The value of total quick assets shows a declining trend from 2020 through 2023, beginning at 11,041 million US dollars in 2020 and decreasing each subsequent year to reach a low of 7,451 million in 2023. There is a moderate rebound in 2024, with an increase to 8,891 million. Although this uptick suggests some recovery, the overall level remains below the initial 2020 figure.
- Current liabilities
- Current liabilities exhibit substantial volatility and an overall increase during the period. Starting at 19,615 million US dollars in 2020, the figure slightly decreases in 2021 but then sharply rises to 27,336 million in 2022. A slight reduction occurs in 2023 to 26,383 million, followed by a significant decline to 22,915 million in 2024. Despite this reduction, current liabilities in 2024 remain elevated relative to the levels seen in 2020 and 2021.
- Quick ratio
- The quick ratio, which measures the ability to cover current liabilities with quick assets, declines consistently from 0.56 in 2020 to 0.28 in 2023, reflecting a weakening liquidity position. This downward trajectory corresponds with the decline in quick assets and the increase in current liabilities during the same period. In 2024, the quick ratio improves to 0.39, aligning with the observed increase in quick assets and reduction in current liabilities, though it remains below the 2020 level, indicating that liquidity has not fully recovered.
In summary, the company experienced a gradual deterioration in its immediate liquidity and short-term financial position from 2020 until 2023, followed by partial improvement in 2024. The reduction in quick assets coupled with elevated current liabilities during most of the period led to lower quick ratios, signaling reduced capacity to meet short-term obligations quickly. The modest recovery in 2024 suggests some restoration of liquidity but not a full return to earlier financial health levels.
Cash Ratio
Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
---|---|---|---|---|---|---|
Selected Financial Data (US$ in millions) | ||||||
Cash and cash equivalents | ||||||
Total cash assets | ||||||
Current liabilities | ||||||
Liquidity Ratio | ||||||
Cash ratio1 | ||||||
Benchmarks | ||||||
Cash Ratio, Competitors2 | ||||||
Coca-Cola Co. | ||||||
Mondelēz International Inc. | ||||||
PepsiCo Inc. | ||||||
Cash Ratio, Sector | ||||||
Food, Beverage & Tobacco | ||||||
Cash Ratio, Industry | ||||||
Consumer Staples |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Total cash assets
- The total cash assets demonstrated a declining trend from 2020 to 2023, starting at 7,280 million US dollars and reaching a low of 3,060 million US dollars. However, in 2024, there was a notable increase to 4,216 million US dollars, indicating a partial recovery in liquidity.
- Current liabilities
- Current liabilities fluctuated during the period under review. They slightly decreased from 19,615 million US dollars in 2020 to 19,255 million in 2021, followed by a sharp increase to 27,336 million in 2022. Subsequently, current liabilities declined over the next two years, settling at 22,915 million in 2024, though remaining above the initial levels of 2020 and 2021.
- Cash ratio
- The cash ratio, an indicator of short-term liquidity, showed a downward trend from 0.37 in 2020 to 0.12 in 2022 and 2023, indicating a reduced ability to cover current liabilities with cash assets during these years. In 2024, the ratio improved to 0.18, suggesting a modest enhancement in the liquidity position but still remaining below the levels observed in the early part of the period.