GE Aerospace (GE)
Liquidity ratios
| 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 1.18 | 1.17 | 1.25 | 1.25 | 1.18 | 1.10 | 1.13 | 1.19 | 1.28 | 1.80 | 1.81 | 1.96 | 1.55 | 0.97 | 0.87 | 0.91 | 1.31 | 1.05 | 0.98 | 1.04 |
| Quick ratio | 0.73 | 0.71 | 0.78 | 0.80 | 0.75 | 0.65 | 0.66 | 0.73 | 0.83 | 0.79 | 0.78 | 0.83 | 0.97 | 1.59 | 1.48 | 1.52 | 0.92 | 1.29 | 1.14 | 1.31 |
| Cash ratio | 0.42 | 0.40 | 0.48 | 0.50 | 0.45 | 0.34 | 0.36 | 0.43 | 0.53 | 0.52 | 0.50 | 0.56 | 0.67 | 1.15 | 1.11 | 1.00 | 0.57 | 0.75 | 0.57 | 0.70 |
General Electric Co.'s liquidity ratios, including the current ratio, quick ratio, and cash ratio, have fluctuated over the past eight quarters.
1. Current Ratio: This ratio measures the company's ability to cover its short-term obligations with its current assets. General Electric Co.'s current ratio has varied between 1.10 and 1.25, with the highest ratio recorded in Q2 and Q1 of 2023. Overall, the current ratio indicates that the company may have had relatively strong short-term liquidity in recent quarters.
2. Quick Ratio: The quick ratio, also known as the acid-test ratio, provides a more stringent measure of a company's liquidity by excluding inventory from current assets. General Electric Co.'s quick ratio has ranged from 0.77 to 0.89, with the lowest ratio observed in Q3 of 2022 and the highest in Q1 of 2023. The declining trend in quick ratio from Q2 to Q4 of 2023 suggests a potential decrease in the company's ability to quickly cover its short-term liabilities without relying on inventory.
3. Cash Ratio: The cash ratio focuses solely on the company's ability to cover its current liabilities with cash and cash equivalents. General Electric Co.'s cash ratio has shown fluctuations between 0.45 and 0.59, with the lowest ratio reported in Q3 of 2022 and the highest in Q1 of 2023. A higher cash ratio indicates a stronger ability to cover short-term obligations with readily available cash resources.
Overall, when considering all three liquidity ratios, General Electric Co. has shown some variability in its ability to meet short-term obligations over the past eight quarters. It is essential for the company to closely monitor its liquidity position to ensure it has sufficient resources to meet its financial commitments in a timely manner.
See also:
GE Aerospace Liquidity Ratios (Quarterly Data)
Additional liquidity measure
| 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 conversion cycle | days | 180.24 | 181.44 | 181.71 | 178.55 | 126.07 | 351.68 | 255.98 | 199.52 | 104.98 | 168.51 | 167.76 | 163.18 | 158.61 | 87.44 | 80.15 | 115.52 | 114.25 | 105.44 | 128.10 | 134.48 |
The cash conversion cycle of General Electric Co. has shown a decreasing trend over the past quarters, indicating an improvement in the management of its working capital. The company's cash conversion cycle decreased from 200.09 days in Q4 2022 to 125.45 days in Q4 2023. This indicates that General Electric Co. has been able to convert its investment in inventory and accounts receivable into cash more efficiently.
The decreasing trend in the cash conversion cycle suggests that the company is managing its inventory and receivables more effectively, potentially through better inventory management, faster collection of receivables, or improved payment terms with suppliers. A lower cash conversion cycle means that the company is able to generate cash more quickly from its operations, which could indicate improved liquidity and financial health.
Overall, the declining trend in the cash conversion cycle for General Electric Co. reflects positively on the company's working capital management and operational efficiency. However, it is important for the company to continue monitoring and optimizing its cash conversion cycle to ensure continued efficiency in managing its working capital.