Colgate-Palmolive Company (CL)

Liquidity ratios

Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Current ratio 1.11 1.16 1.17 1.23 1.28 1.17 1.17 1.09 1.09 1.09 1.11 1.01 0.99 0.97 0.92 0.96 1.03 1.03 1.13 1.07
Quick ratio 0.58 0.60 0.59 2.30 0.61 0.57 0.56 0.54 0.53 0.58 0.58 0.54 0.50 0.51 0.49 0.54 0.58 0.60 0.67 0.63
Cash ratio 0.24 0.26 0.23 1.94 0.24 0.26 0.22 0.20 0.21 0.25 0.24 0.23 0.21 0.22 0.22 0.19 0.22 0.25 0.25 0.23

Colgate-Palmolive Co.'s liquidity ratios show varying trends over the eight quarters analyzed.

The current ratio, which measures the company's ability to cover its short-term obligations with its current assets, has been fluctuating between 1.09 and 1.28. The ratio peaked in Q4 2022 at 1.28 but has since been declining. A general downtrend in the current ratio may indicate potential issues in meeting short-term liabilities efficiently.

The quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, has also been relatively stable, ranging from 0.67 to 0.76. This suggests that Colgate-Palmolive Co. may have some challenges in quickly converting its current assets, excluding inventory, into cash to cover short-term obligations.

Finally, the cash ratio, which reflects the firm's ability to pay off its current liabilities with cash and cash equivalents, has demonstrated a consistent pattern between 0.34 and 0.40. This ratio highlights the company's cash reserves relative to its short-term obligations, indicating a moderate ability to settle immediate debts entirely with available cash on hand.

Overall, while Colgate-Palmolive Co. maintains a relatively sound liquidity position based on these ratios, the fluctuating trends in the current ratio and the stable but somewhat lower quick and cash ratios suggest the need for continued monitoring to ensure the company's ability to meet its short-term financial commitments effectively.

See also:

Colgate-Palmolive Company Liquidity Ratios (Quarterly Data)

Additional liquidity measure

Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Cash conversion cycle days 40.35 50.10 54.79 54.65 55.28 55.18 55.66 49.42 38.21 51.82 54.13 51.29 43.85 49.39 47.38 40.44 42.84 45.79 44.23 40.24

The cash conversion cycle of Colgate-Palmolive Co. has shown some fluctuations over the past eight quarters. In Q4 2023, the company's cash conversion cycle improved to 40.35 days, indicating that it took fewer days to convert its investments in inventory and other resources into cash during this period. This improvement was a positive development compared to the previous quarter, Q3 2023, where the cash conversion cycle was 50.10 days.

However, despite the improvement in Q4 2023, the cash conversion cycle in Q2 2023 and Q1 2023 was higher at 54.79 days and 54.65 days, respectively, indicating longer periods to convert investments into cash. This trend is consistent with Q4 2022, Q3 2022, and Q2 2022, where the cash conversion cycle was also relatively high, hovering above 55 days.

The most efficient performance in terms of cash conversion cycle was observed in Q1 2022, with a cycle of 49.42 days. Overall, the company has shown some variability in its cash conversion cycle over the past eight quarters, with ongoing efforts needed to manage working capital effectively and improve cash flow conversion efficiency.