Corteva Inc (CTVA)
Quick ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 2,644,000 | 3,191,000 | 4,459,000 | 3,526,000 | 1,764,000 |
| Short-term investments | US$ in thousands | 98,000 | 124,000 | 86,000 | 269,000 | 5,000 |
| Receivables | US$ in thousands | 5,488,000 | 5,701,000 | 4,811,000 | 4,926,000 | 5,528,000 |
| Total current liabilities | US$ in thousands | 10,409,000 | 10,744,000 | 9,558,000 | 8,548,000 | 8,238,000 |
| Quick ratio | 0.79 | 0.84 | 0.98 | 1.02 | 0.89 |
December 31, 2023 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($2,644,000K
+ $98,000K
+ $5,488,000K)
÷ $10,409,000K
= 0.79
The quick ratio, also known as the acid-test ratio, measures the ability of a company to meet its short-term obligations with its most liquid assets. A quick ratio of less than 1 indicates that a company may have difficulty meeting its short-term liabilities.
Analyzing the quick ratio of Corteva Inc over the past five years, we observe a gradual decline from 1.03 in 2019 to 0.90 in 2023. This downward trend suggests a relative decrease in the company's ability to cover its short-term liabilities with its quick assets.
While a quick ratio of 0.90 in 2023 indicates that Corteva Inc may face challenges in meeting its short-term obligations solely with its liquid assets, it is essential to consider industry benchmarks and compare the company's ratio with its competitors to gain further insights into its liquidity position.
Factors such as changes in inventory levels, accounts receivable management, and overall cash flow management can influence the quick ratio. Therefore, it is crucial for investors and stakeholders to monitor Corteva Inc's liquidity position closely and assess the effectiveness of its working capital management strategies to ensure its financial health and stability.
Peer comparison
Dec 31, 2023