Baker Hughes Co (BKR)

Cash ratio

Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Cash and cash equivalents US$ in thousands 3,364,000 2,646,000 1,883,000 3,252,000 3,445,000
Short-term investments US$ in thousands 1,281,000 975,000 748,000 1,033,000 1,502,000
Total current liabilities US$ in thousands 12,991,000 12,991,000 11,075,000 9,128,000 10,227,000
Cash ratio 0.36 0.28 0.24 0.47 0.48

December 31, 2024 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($3,364,000K + $1,281,000K) ÷ $12,991,000K
= 0.36

The cash ratio of Baker Hughes Co has shown fluctuations over the years. As of December 31, 2020, the company had a cash ratio of 0.48, indicating that it had $0.48 in cash and cash equivalents for every $1 of current liabilities. However, this ratio slightly decreased to 0.47 by December 31, 2021.

There was a significant decline in the cash ratio to 0.24 by December 31, 2022, suggesting a potential liquidity concern as the company may have had fewer liquid assets to cover its short-term obligations.

Subsequently, the cash ratio improved to 0.28 by December 31, 2023, indicating a slight enhancement in the company's ability to cover its short-term liabilities with cash reserves.

By December 31, 2024, the cash ratio further increased to 0.36, showing continued progress in liquidity management. Overall, Baker Hughes Co should continue monitoring its cash ratio to ensure it maintains an appropriate level of liquidity to meet its short-term obligations.