Darden Restaurants Inc (DRI)
Current ratio
| May 31, 2024 | May 26, 2024 | May 31, 2023 | May 28, 2023 | May 31, 2022 | ||
|---|---|---|---|---|---|---|
| Total current assets | US$ in thousands | 822,800 | 822,800 | 997,700 | 997,700 | 1,179,400 |
| Total current liabilities | US$ in thousands | 2,192,500 | 2,192,500 | 1,937,400 | 1,937,400 | 1,847,500 |
| Current ratio | 0.38 | 0.38 | 0.51 | 0.51 | 0.64 |
May 31, 2024 calculation
Current ratio = Total current assets ÷ Total current liabilities
= $822,800K ÷ $2,192,500K
= 0.38
The current ratio of Darden Restaurants Inc has been declining over the past few years, indicating a weakening liquidity position. As of May 31, 2022, the current ratio was 0.64, which means that the company had $0.64 in current assets for every $1 in current liabilities. However, by May 31, 2024, the current ratio had decreased to 0.38, signaling a decrease in the company's ability to cover its short-term obligations with its current assets.
This downward trend in the current ratio raises concerns about Darden Restaurants Inc's short-term financial health and ability to meet its immediate financial obligations. Investors and creditors may view a low current ratio as a red flag for potential liquidity issues and may question the company's ability to manage its working capital effectively. It is essential for Darden Restaurants Inc to closely monitor its current ratio and take steps to improve it, such as increasing current assets or reducing current liabilities, to ensure its financial stability in the short term.
Peer comparison
May 31, 2024