Fortive Corp (FTV)
Quick ratio
Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
---|---|---|---|---|---|---|
Cash | US$ in thousands | 1,888,800 | 709,200 | 819,300 | 1,824,800 | 1,205,200 |
Short-term investments | US$ in thousands | — | — | 0 | 1,119,200 | 0 |
Receivables | US$ in thousands | 960,800 | 958,500 | 930,200 | 810,300 | 1,384,500 |
Total current liabilities | US$ in thousands | 1,791,300 | 2,727,100 | 3,714,900 | 2,860,800 | 3,467,200 |
Quick ratio | 1.59 | 0.61 | 0.47 | 1.31 | 0.75 |
December 31, 2023 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($1,888,800K
+ $—K
+ $960,800K)
÷ $1,791,300K
= 1.59
The quick ratio of Fortive Corp has shown fluctuations over the past five years. In 2019, the quick ratio was 0.88, indicating that the company had $0.88 in liquid assets to cover each dollar of current liabilities. This ratio improved in 2020 to 1.38, suggesting a healthier liquidity position with $1.38 in liquid assets available for every dollar of current liabilities.
However, in 2021, the quick ratio decreased to 0.54, indicating a significant decline in the company's ability to meet its short-term obligations with its liquid assets. The quick ratio further improved in 2022 to 0.71 but remained below the ideal value of 1.
In 2023, the quick ratio increased substantially to 1.75, signaling a strong improvement in the company's liquidity position and its ability to cover short-term liabilities more comfortably.
Overall, the trend in Fortive Corp's quick ratio has been volatile, with fluctuations from year to year. It is essential for the company to maintain a healthy quick ratio above 1 to ensure it has an adequate level of liquid assets to meet its short-term obligations without relying too heavily on inventory.
Peer comparison
Dec 31, 2023