Arrow Electronics Inc (ARW)
Quick ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 188,807 | 218,053 | 176,915 | 222,194 | 373,615 |
| Short-term investments | US$ in thousands | — | — | — | — | 76,358 |
| Receivables | US$ in thousands | 13,031,000 | 12,238,100 | 12,322,700 | 11,123,900 | 9,205,340 |
| Total current liabilities | US$ in thousands | 12,636,200 | 13,187,900 | 12,389,600 | 11,326,100 | 9,130,880 |
| Quick ratio | 1.05 | 0.94 | 1.01 | 1.00 | 1.06 |
December 31, 2024 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($188,807K
+ $—K
+ $13,031,000K)
÷ $12,636,200K
= 1.05
The quick ratio, also known as the acid-test ratio, measures a company's ability to meet its short-term obligations with its most liquid assets. Arrow Electronics Inc's quick ratio has shown fluctuation over the past five years.
As of December 31, 2020, the quick ratio was 1.06, indicating that the company had $1.06 in highly liquid assets available for each dollar of current liabilities. This suggests a healthy liquidity position. However, by December 31, 2021, the quick ratio decreased to 1.00, indicating a slight reduction in the company's ability to cover its short-term obligations.
The trend continued in the following years, with the quick ratio being 1.01 as of December 31, 2022, before dropping to 0.94 by December 31, 2023. A quick ratio below 1 typically raises concerns about a company's liquidity and its ability to meet its short-term liabilities.
However, the quick ratio improved again to 1.05 by December 31, 2024, suggesting a positive trend in the company's liquidity position. Overall, Arrow Electronics Inc's quick ratio has shown variability in recent years, indicating the need for close monitoring of its liquidity and short-term financial health.
Peer comparison
Dec 31, 2024