Archer-Daniels-Midland Company (ADM)
Cash ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 611,000 | 1,368,000 | 1,037,000 | 943,000 | 666,000 |
| Short-term investments | US$ in thousands | 246,000 | 7,228,000 | 109,000 | 46,000 | 61,000 |
| Total current liabilities | US$ in thousands | 19,938,000 | 18,662,000 | 24,191,000 | 21,948,000 | 18,182,000 |
| Cash ratio | 0.04 | 0.46 | 0.05 | 0.05 | 0.04 |
December 31, 2024 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($611,000K
+ $246,000K)
÷ $19,938,000K
= 0.04
The cash ratio of Archer-Daniels-Midland Company has exhibited fluctuations over the past five years, calculated as 0.04, 0.05, 0.05, 0.46, and 0.04 for the years ending December 31, 2020, 2021, 2022, 2023, and 2024 respectively. The ratio indicates the company's ability to cover its short-term liabilities using its cash and cash equivalents.
The sudden spike observed in 2023, where the cash ratio soared to 0.46, suggests a significant increase in available cash relative to current obligations. This could be due to an increase in cash reserves or a reduction in short-term liabilities during that period. However, the ratio swiftly dropped back to 0.04 in 2024, possibly indicating a return to previous levels of cash availability in comparison to short-term obligations.
Overall, the cash ratio of Archer-Daniels-Midland Company has shown variability, with the company's ability to meet short-term liabilities fluctuating over the years. It would be important to further investigate the reasons behind these fluctuations to assess the company's liquidity position effectively.
Peer comparison
Dec 31, 2024