Analysis of Liquidity Ratios
Liquidity ratios measure the company ability to meet its short-term obligations.
Liquidity Ratios (Summary)
RTX Corp., liquidity ratios
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Current ratio | 1.03 | 0.99 | 1.04 | 1.09 | 1.19 | |
| Quick ratio | 0.67 | 0.60 | 0.63 | 0.69 | 0.81 | |
| Cash ratio | 0.13 | 0.11 | 0.14 | 0.16 | 0.22 |
Based on: 10-K (reporting date: 2025-12-31), 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).
The liquidity position of the company exhibits a generally declining trend from 2021 through 2024, with a slight recovery indicated in 2025. This assessment is based on the observed movements in the current, quick, and cash ratios over the five-year period.
- Current Ratio
- The current ratio decreased steadily from 1.19 in 2021 to 0.99 in 2024, indicating a weakening ability to cover short-term liabilities with short-term assets. A modest increase to 1.03 is noted in 2025, suggesting a potential stabilization, though remaining below the 2021 level. This decline implies increasing reliance on inventory and other less liquid assets to meet immediate obligations.
- Quick Ratio
- The quick ratio demonstrates a consistent downward trend, falling from 0.81 in 2021 to a low of 0.60 in 2024. This indicates a diminishing capacity to meet short-term obligations with the most liquid assets – cash and marketable securities. The ratio experiences a slight improvement to 0.67 in 2025, but remains considerably lower than the 2021 value. This suggests a growing dependence on inventory liquidation to satisfy current liabilities.
- Cash Ratio
- The cash ratio shows the most pronounced decline, decreasing from 0.22 in 2021 to 0.11 in 2024. This signifies a substantial reduction in the company’s ability to cover immediate liabilities with only cash and cash equivalents. A minor increase to 0.13 is observed in 2025, but the ratio remains at a low level, highlighting a limited cushion of highly liquid assets.
Collectively, these ratios suggest a gradual erosion of the company’s short-term liquidity. While a slight improvement is visible in 2025 across all three metrics, the levels remain below those observed in 2021, warranting continued monitoring of the company’s ability to manage its short-term obligations.
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Current Ratio
RTX Corp., current ratio calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Current assets | 60,332) | 51,133) | 48,417) | 42,443) | 42,050) | |
| Current liabilities | 58,784) | 51,499) | 46,761) | 39,114) | 35,449) | |
| Liquidity Ratio | ||||||
| Current ratio1 | 1.03 | 0.99 | 1.04 | 1.09 | 1.19 | |
| Benchmarks | ||||||
| Current Ratio, Competitors2 | ||||||
| Boeing Co. | 1.19 | 1.32 | 1.14 | 1.22 | 1.33 | |
| Caterpillar Inc. | 1.44 | 1.42 | 1.35 | 1.39 | 1.46 | |
| Eaton Corp. plc | 1.32 | 1.50 | 1.51 | 1.38 | 1.04 | |
| GE Aerospace | 1.04 | 1.09 | 1.18 | 1.16 | 1.28 | |
| Honeywell International Inc. | 1.30 | 1.31 | 1.27 | 1.25 | 1.30 | |
| Lockheed Martin Corp. | 1.09 | 1.13 | 1.21 | 1.32 | 1.42 | |
| Current Ratio, Sector | ||||||
| Capital Goods | 1.17 | 1.23 | 1.18 | 1.22 | 1.31 | |
| Current Ratio, Industry | ||||||
| Industrials | 1.13 | 1.19 | 1.16 | 1.20 | 1.29 | |
Based on: 10-K (reporting date: 2025-12-31), 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).
1 2025 Calculation
Current ratio = Current assets ÷ Current liabilities
= 60,332 ÷ 58,784 = 1.03
2 Click competitor name to see calculations.
The current ratio exhibited a generally declining trend from 2021 to 2024, followed by a slight recovery in 2025. While remaining above one throughout the period, the ratio’s movement suggests evolving liquidity dynamics within the observed timeframe.
- Current Ratio Trend
- The current ratio began at 1.19 in 2021, indicating the company possessed $1.19 of current assets for every $1.00 of current liabilities. A decrease was observed in 2022 to 1.09, and this downward trend continued, reaching 1.04 in 2023 and further declining to 0.99 in 2024. This represents the narrowest margin of liquidity over the period. In 2025, the ratio increased marginally to 1.03.
- Asset and Liability Dynamics
- Both current assets and current liabilities increased consistently throughout the period. However, the growth rate of current liabilities generally exceeded that of current assets, particularly between 2022 and 2024. This differential growth in liabilities contributed to the observed decline in the current ratio. The acceleration in current asset growth in 2025 partially offset the liability increase, leading to the ratio’s slight improvement.
The consistent increase in both current assets and current liabilities suggests overall business expansion. However, the relative increase in current liabilities warrants monitoring, as a sustained decline in the current ratio could indicate increasing short-term financial risk. The recovery in 2025 provides a potential signal of stabilization, but continued observation is necessary to confirm a sustained positive trend.
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Quick Ratio
RTX Corp., quick ratio calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Cash and cash equivalents | 7,435) | 5,578) | 6,587) | 6,220) | 7,832) | |
| Accounts receivable, net | 14,701) | 10,976) | 10,838) | 9,108) | 9,661) | |
| Contract assets, net | 17,092) | 14,570) | 12,139) | 11,534) | 11,361) | |
| Total quick assets | 39,228) | 31,124) | 29,564) | 26,862) | 28,854) | |
| Current liabilities | 58,784) | 51,499) | 46,761) | 39,114) | 35,449) | |
| Liquidity Ratio | ||||||
| Quick ratio1 | 0.67 | 0.60 | 0.63 | 0.69 | 0.81 | |
| Benchmarks | ||||||
| Quick Ratio, Competitors2 | ||||||
| Boeing Co. | 0.38 | 0.39 | 0.28 | 0.32 | 0.34 | |
| Caterpillar Inc. | 0.86 | 0.80 | 0.74 | 0.79 | 0.89 | |
| Eaton Corp. plc | 0.66 | 0.85 | 0.91 | 0.73 | 0.54 | |
| GE Aerospace | 0.71 | 0.78 | 0.78 | 0.81 | 0.93 | |
| Honeywell International Inc. | 0.88 | 0.88 | 0.84 | 0.88 | 0.94 | |
| Lockheed Martin Corp. | 0.90 | 0.92 | 0.99 | 1.09 | 1.15 | |
| Quick Ratio, Sector | ||||||
| Capital Goods | 0.63 | 0.62 | 0.60 | 0.64 | 0.71 | |
| Quick Ratio, Industry | ||||||
| Industrials | 0.67 | 0.68 | 0.65 | 0.71 | 0.80 | |
Based on: 10-K (reporting date: 2025-12-31), 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).
1 2025 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= 39,228 ÷ 58,784 = 0.67
2 Click competitor name to see calculations.
The quick ratio for the analyzed period demonstrates a generally declining trend, followed by a modest recovery in the most recent year. Initial values indicate a reasonable, though not exceptionally strong, ability to meet short-term obligations with highly liquid assets. However, subsequent years reveal a weakening of this position before a slight improvement.
- Quick Ratio Trend
- The quick ratio decreased from 0.81 in 2021 to 0.60 in 2024, representing a consistent erosion of the company’s ability to cover current liabilities with its most liquid assets. This suggests a potential increase in reliance on inventory or a more rapid increase in current liabilities relative to quick assets. The ratio then experienced a slight increase to 0.67 in 2025, indicating a partial reversal of the declining trend.
- Quick Asset Evolution
- Total quick assets initially decreased from US$28,854 million in 2021 to US$26,862 million in 2022. A subsequent increase to US$29,564 million in 2023 was followed by further growth to US$31,124 million in 2024. The most significant increase occurred between 2024 and 2025, with quick assets reaching US$39,228 million. This suggests a strategic build-up of liquid assets in the latest period.
- Current Liability Evolution
- Current liabilities exhibited a consistent upward trend throughout the analyzed period. Starting at US$35,449 million in 2021, they increased to US$39,114 million in 2022, US$46,761 million in 2023, US$51,499 million in 2024, and reached US$58,784 million in 2025. The growth in current liabilities consistently outpaced the growth in quick assets until 2025, contributing to the initial decline in the quick ratio.
The increase in quick assets in 2025, coupled with the continued growth in current liabilities, resulted in a stabilization of the quick ratio. While the ratio remains below the initial 2021 level, the recent improvement suggests a potential shift in the company’s short-term financial position. Further investigation into the composition of both quick assets and current liabilities is recommended to fully understand the drivers behind these trends.
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Cash Ratio
RTX Corp., cash ratio calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Cash and cash equivalents | 7,435) | 5,578) | 6,587) | 6,220) | 7,832) | |
| Total cash assets | 7,435) | 5,578) | 6,587) | 6,220) | 7,832) | |
| Current liabilities | 58,784) | 51,499) | 46,761) | 39,114) | 35,449) | |
| Liquidity Ratio | ||||||
| Cash ratio1 | 0.13 | 0.11 | 0.14 | 0.16 | 0.22 | |
| Benchmarks | ||||||
| Cash Ratio, Competitors2 | ||||||
| Boeing Co. | 0.27 | 0.27 | 0.17 | 0.19 | 0.20 | |
| Caterpillar Inc. | 0.27 | 0.21 | 0.20 | 0.22 | 0.31 | |
| Eaton Corp. plc | 0.09 | 0.26 | 0.34 | 0.09 | 0.08 | |
| GE Aerospace | 0.32 | 0.42 | 0.45 | 0.44 | 0.54 | |
| Honeywell International Inc. | 0.55 | 0.52 | 0.44 | 0.51 | 0.59 | |
| Lockheed Martin Corp. | 0.18 | 0.13 | 0.09 | 0.16 | 0.26 | |
| Cash Ratio, Sector | ||||||
| Capital Goods | 0.26 | 0.26 | 0.24 | 0.26 | 0.32 | |
| Cash Ratio, Industry | ||||||
| Industrials | 0.30 | 0.31 | 0.28 | 0.32 | 0.39 | |
Based on: 10-K (reporting date: 2025-12-31), 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).
1 2025 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= 7,435 ÷ 58,784 = 0.13
2 Click competitor name to see calculations.
The cash ratio for the analyzed period demonstrates a generally declining trend, although a slight recovery is observed in the most recent year. Total cash assets fluctuate over the period, while current liabilities consistently increase. This combination drives the observed trend in the cash ratio.
- Cash Ratio Trend
- The cash ratio decreased from 0.22 in 2021 to 0.11 in 2024, representing a substantial reduction in the company’s ability to cover its current liabilities with only cash and cash equivalents. A modest increase to 0.13 is then noted in 2025, indicating a slight improvement but not reversing the overall downward trajectory.
- Total Cash Assets
- Total cash assets experienced a decrease from US$7,832 million in 2021 to US$6,220 million in 2022. A subsequent increase to US$6,587 million occurred in 2023, followed by a further decline to US$5,578 million in 2024. The final year, 2025, shows a significant recovery, with cash assets rising to US$7,435 million.
- Current Liabilities
- Current liabilities exhibit a consistent upward trend throughout the analyzed period. Beginning at US$35,449 million in 2021, they increased to US$39,114 million in 2022, US$46,761 million in 2023, US$51,499 million in 2024, and reached US$58,784 million in 2025. This continuous growth in current obligations contributes to the decreasing cash ratio.
The combination of fluctuating cash assets and consistently increasing current liabilities suggests a potential weakening in the company’s short-term liquidity position over the majority of the period. The improvement in the cash ratio in 2025, driven by a substantial increase in cash assets, may indicate a strategic shift or a temporary improvement in the company’s financial flexibility.
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