FedEx Corporation (FDX)
Cash ratio
| May 31, 2025 | May 31, 2024 | May 31, 2023 | May 31, 2022 | May 31, 2021 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 5,502,000 | 6,501,000 | 6,823,000 | 6,897,000 | 7,087,000 |
| Short-term investments | US$ in thousands | — | 360,000 | 302,000 | — | 24,168,000 |
| Total current liabilities | US$ in thousands | 15,435,000 | 13,355,000 | 13,553,000 | 14,274,000 | 13,660,000 |
| Cash ratio | 0.36 | 0.51 | 0.53 | 0.48 | 2.29 |
May 31, 2025 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($5,502,000K
+ $—K)
÷ $15,435,000K
= 0.36
The cash ratio of FedEx Corporation has exhibited notable fluctuations over the observed period from May 31, 2021, to May 31, 2025. As of May 31, 2021, the cash ratio stood at 2.29, indicating that the company held cash and cash equivalents exceeding its current liabilities, providing a substantial buffer for short-term obligations.
Between 2021 and 2022, there was a significant decline in the cash ratio to 0.48, representing a reduction in liquidity relative to current liabilities. The decrease suggests either a decline in cash holdings, an increase in current liabilities, or a combination of both. This sharp decline reflects a potential shift in liquidity management or operational cash flows during that period.
From May 31, 2022, to May 31, 2023, the cash ratio experienced a slight recovery to 0.53. Although marginal, this uptick indicates a modest improvement in cash position relative to short-term obligations. The ratio remained relatively stable through this interval, suggesting stabilization after the previous decline.
The trend from 2023 to 2024 shows the ratio consolidating around 0.51, indicating consistent liquidity levels comparable to the prior year. Such stability hints at maintained operational cash management strategies, with no significant alterations in cash reserves or current liabilities.
By May 31, 2025, the cash ratio further declined to 0.36. This continued downward trend highlights a reduction in the company's cash holdings relative to its current liabilities, potentially implying a decreased liquidity cushion and increased reliance on other forms of current assets or liabilities management.
Overall, the chronologically decreasing trend in the cash ratio from 2.29 in 2021 to 0.36 in 2025 suggests a gradual decline in FedEx’s liquidity position in terms of cash and cash equivalents relative to its short-term obligations. This pattern may reflect strategic capital allocations, operational shifts, or changes in liquidity management policies, warranting further investigation into the company's broader financial health and current asset composition during this period.