Caterpillar Inc (CAT)
Cash ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 6,889,000 | 6,978,000 | 7,004,000 | 9,254,000 | 9,352,000 |
| Short-term investments | US$ in thousands | — | 1,900,000 | — | 964,000 | 9,352,000 |
| Total current liabilities | US$ in thousands | 32,272,000 | 34,728,000 | 31,531,000 | 29,847,000 | 25,717,000 |
| Cash ratio | 0.21 | 0.26 | 0.22 | 0.34 | 0.73 |
December 31, 2024 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($6,889,000K
+ $—K)
÷ $32,272,000K
= 0.21
The cash ratio for Caterpillar Inc has shown a declining trend over the years. Starting at 0.73 on December 31, 2020, it decreased to 0.34 by December 31, 2021, indicating a decrease in the company's ability to cover its short-term liabilities with its cash and cash equivalents. This declining trend continued through the subsequent years, with the cash ratio further dropping to 0.22 on December 31, 2022, 0.26 on December 31, 2023, and 0.21 on December 31, 2024.
The decreasing cash ratio may suggest that Caterpillar Inc may be facing challenges in managing its short-term liquidity requirements or that its cash position relative to its current liabilities is weakening. It is crucial for the company to closely monitor its cash management practices and take necessary steps to improve liquidity in order to maintain financial stability and meet its short-term obligations effectively.
Peer comparison
Dec 31, 2024