Cummins Inc (CMI)
Cash ratio
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 1,671,000 | 1,733,000 | 1,590,000 | 2,541,000 | 2,179,000 | 2,387,000 | 1,802,000 | 1,980,000 | 2,020,000 | 2,499,000 | 2,462,000 | 2,276,000 | 2,592,000 | 2,588,000 | 2,481,000 | 2,958,000 | 3,401,000 | 2,967,000 | 1,751,000 | 1,691,000 |
| Short-term investments | US$ in thousands | 593,000 | 518,000 | 593,000 | 510,000 | 562,000 | 677,000 | 512,000 | 459,000 | 553,000 | 466,000 | 536,000 | 527,000 | 595,000 | 430,000 | 438,000 | 397,000 | 461,000 | 345,000 | 353,000 | 339,000 |
| Total current liabilities | US$ in thousands | 11,234,000 | 11,603,000 | 11,144,000 | 11,686,000 | 12,903,000 | 11,126,000 | 11,045,000 | 11,923,000 | 11,421,000 | 10,530,000 | 7,671,000 | 7,512,000 | 7,084,000 | 6,861,000 | 6,604,000 | 6,660,000 | 6,335,000 | 5,709,000 | 6,916,000 | 6,982,000 |
| Cash ratio | 0.20 | 0.19 | 0.20 | 0.26 | 0.21 | 0.28 | 0.21 | 0.20 | 0.23 | 0.28 | 0.39 | 0.37 | 0.45 | 0.44 | 0.44 | 0.50 | 0.61 | 0.58 | 0.30 | 0.29 |
December 31, 2024 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($1,671,000K
+ $593,000K)
÷ $11,234,000K
= 0.20
Cummins Inc's cash ratio has shown some fluctuations over the past few years. The cash ratio measures the company's ability to cover its short-term liabilities with its cash and cash equivalents.
In the first quarter of 2020, the cash ratio was 0.29, indicating that Cummins had $0.29 of cash and cash equivalents for every $1 of current liabilities. The ratio slightly increased in the following quarter to 0.30 and experienced a more significant improvement in the third quarter of 2020, reaching 0.58. This suggests that Cummins significantly increased its cash reserves relative to its short-term obligations during that period.
The cash ratio continued to improve throughout 2020 and 2021, reaching 0.45 by the end of December 2021. However, there was a slight decline in the first quarter of 2022 to 0.37. The ratio fluctuated between 0.20 and 0.44 during 2022 and 2023, showing some variability in the company's cash position.
By the end of 2024, Cummins' cash ratio had decreased to 0.20, indicating a slight decline in the company's ability to cover its short-term liabilities with cash and cash equivalents.
Overall, although there have been fluctuations in the cash ratio, Cummins Inc has generally maintained a healthy level of liquidity relative to its short-term obligations during the period under review. It is essential for investors and analysts to continue monitoring the company's cash position to ensure it remains sufficient to meet its financial obligations.
Peer comparison
Dec 31, 2024