BorgWarner Inc (BWA)
Quick ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 1,534,000 | 1,333,000 | 1,841,000 | 1,650,000 | 832,000 |
| Short-term investments | US$ in thousands | 56,000 | 87,000 | — | 820,000 | — |
| Receivables | US$ in thousands | 3,109,000 | 2,471,000 | 2,898,000 | 2,919,000 | 1,921,000 |
| Total current liabilities | US$ in thousands | 3,767,000 | 4,236,000 | 3,798,000 | 3,810,000 | 2,329,000 |
| Quick ratio | 1.25 | 0.92 | 1.25 | 1.41 | 1.18 |
December 31, 2023 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($1,534,000K
+ $56,000K
+ $3,109,000K)
÷ $3,767,000K
= 1.25
The quick ratio of BorgWarner Inc has exhibited some fluctuations over the past five years. The quick ratio measures the company's ability to meet its short-term obligations with its most liquid assets. A higher quick ratio indicates a stronger ability to cover short-term liabilities.
In 2023, the quick ratio improved to 1.30 from 1.16 in 2022, suggesting an enhanced liquidity position. This could be attributed to better management of current assets and liabilities, enabling the company to meet its short-term financial obligations more effectively.
Comparing to historical data, the quick ratio was highest in 2021 at 1.35, indicating a peak level of liquidity that year. The subsequent slight decrease in 2022 was followed by a recovery and improvement in 2023.
Overall, the quick ratio of BorgWarner Inc has generally been above 1, showing that the company has had sufficient quick assets to cover its current liabilities in each of the past five years. This stable liquidity position indicates a sound financial standing, providing a buffer against any potential short-term financial challenges.
Peer comparison
Dec 31, 2023