The Boeing Company (BA)

The liquidity ratios of Boeing Co. indicate its ability to meet short-term obligations and manage its current assets. The current ratio, which measures the company's ability to pay off short-term liabilities with its current assets, has shown a declining trend from 2019 to 2023, decreasing from 1.03 to 1.14. This suggests a potential decrease in the company's ability to cover its short-term obligations with its current assets.

The quick ratio, which is a more stringent measure of liquidity excluding inventory from current assets, has also shown a declining trend from 2019 to 2023, decreasing from 0.26 to 0.31. This indicates a potential weakening of Boeing's ability to cover immediate liabilities with its most liquid assets.

The cash ratio, which measures a company's ability to cover its short-term liabilities with its cash and cash equivalents, has also shown a decreasing trend, falling from 0.13 in 2019 to 0.19 in 2023. This suggests a potential decrease in Boeing's ability to cover its immediate liabilities with its cash reserves.

Overall, the declining trend in Boeing's liquidity ratios from 2019 to 2023 indicates a potential deterioration in the company's ability to meet short-term obligations with its current assets and cash reserves. This may raise concerns about Boeing's short-term financial stability and ability to weather economic downturns or unexpected financial challenges.

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See also:

The Boeing Company Liquidity Ratios

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Additional liquidity measure

The cash conversion cycle of Boeing Co. has shown some fluctuation over the past five years. The cycle measures the number of days it takes for a company to convert its investments in inventory and other resources into cash flows from sales.

From 2019 to 2020, the cash conversion cycle decreased significantly from 368.14 days to 455.98 days, indicating that Boeing Co. was able to more efficiently convert its inventory and other resources into cash during this period. However, in 2021, the cycle increased to 494.61 days, suggesting a potential slowdown in the company's ability to convert investments into cash flows.

In 2022, there was another increase to 454.30 days, which was then followed by a decrease to 404.51 days at the end of 2023. This may indicate that Boeing Co. made improvements in its management of inventory and other working capital components, leading to a more efficient cash conversion cycle.

Overall, the trend in Boeing Co.'s cash conversion cycle indicates some variability in the efficiency of its working capital management over the past five years, with a notable improvement from 2019 to 2020, followed by some fluctuations in subsequent years. This suggests that the company could benefit from continued focus on optimizing its cash conversion cycle to enhance its overall financial performance.