Ecolab Inc (ECL)

Cash ratio

		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 and cash equivalents	US$ in thousands	919,500	1,001,300	554,200	419,400	598,600	112,900	124,900	99,400	359,900	897,900	1,402,400	1,189,500	1,260,200	1,034,700	1,369,000	1,661,900	118,800	135,900	85,700	79,000
Short-term investments	US$ in thousands	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	67,600	—	—	—
Total current liabilities	US$ in thousands	4,345,800	4,600,500	4,467,500	4,489,600	4,210,400	3,772,300	3,806,000	3,631,300	3,553,200	2,894,500	2,880,300	2,852,200	2,932,200	3,106,400	3,227,700	4,257,400	3,630,600	3,919,500	4,127,700	4,156,000
Cash ratio		0.21	0.22	0.12	0.09	0.14	0.03	0.03	0.03	0.10	0.31	0.49	0.42	0.43	0.33	0.42	0.39	0.05	0.03	0.02	0.02

December 31, 2023 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($919,500K + $—K) ÷ $4,345,800K
= 0.21

The cash ratio measures a company's ability to cover its short-term obligations with its cash and cash equivalents. A higher cash ratio indicates a stronger ability to meet short-term liabilities.

Analyzing Ecolab, Inc.'s cash ratio over the past eight quarters, we can observe fluctuations in the ratio. In Q4 2023 and Q3 2023, the cash ratio stood at 0.26 and 0.27 respectively, showing relatively stable liquidity levels. This indicates that Ecolab had more cash and cash equivalents available in relation to its current liabilities during these periods.

However, in the previous quarters, the cash ratio was lower, with Q2 2023 at 0.18 and Q1 2023 at 0.15. This suggests a potential decrease in available cash to cover short-term obligations during these periods.

Comparing to the same quarters in the previous year, the cash ratio has shown an improvement. For example, the cash ratio in Q4 2023 (0.26) was higher than Q4 2022 (0.19), indicating enhanced liquidity management over the year.

Overall, although there have been fluctuations in Ecolab's cash ratio, the company has generally maintained a reasonable level of liquidity, ensuring it can meet its short-term financial obligations. Monitoring this ratio over time can provide insights into the company's liquidity management and financial health.