Abbott Laboratories (ABT)

Quick ratio

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Cash	US$ in thousands	7,616,000	6,896,000	9,882,000	9,799,000	6,838,000
Short-term investments	US$ in thousands	351,000	383,000	288,000	450,000	310,000
Receivables	US$ in thousands	—	—	—	—	—
Total current liabilities	US$ in thousands	14,157,000	13,841,000	15,489,000	13,105,000	11,907,000
Quick ratio		0.56	0.53	0.66	0.78	0.60

December 31, 2024 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($7,616,000K + $351,000K + $—K) ÷ $14,157,000K
= 0.56

The quick ratio of Abbott Laboratories indicates the company's ability to meet its short-term obligations with its most liquid assets. Looking at the trend over the past five years, we can observe fluctuations in the quick ratio, ranging from 0.53 to 0.78.

In 2020, the quick ratio was at a lower level of 0.60, suggesting that Abbott Laboratories may have had difficulty meeting its short-term obligations with its quick assets alone. However, there was an improvement in 2021, with the quick ratio increasing to 0.78, indicating a better ability to cover immediate liabilities.

Subsequently, there was a slight decline in the quick ratio in 2022 to 0.66, followed by a more significant decrease to 0.53 in 2023. This decrease may raise concerns about Abbott Laboratories' liquidity position and its ability to meet short-term obligations without relying on inventory or other less liquid assets.

However, in 2024, the quick ratio improved to 0.56, although it is still lower compared to the levels seen in 2021 and 2022. This improvement suggests some strengthening in Abbott Laboratories' liquidity position, but the ratio remains below the ideal benchmark of 1.0, indicating potential challenges in meeting short-term obligations solely with quick assets.

In conclusion, Abbott Laboratories' quick ratio trend demonstrates fluctuations over the years, with periods of improvement and decline. It is important for investors and stakeholders to monitor the company's liquidity position closely to ensure its ability to meet short-term obligations efficiently.