Greif Bros Corporation (GEF)
Current ratio
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total current assets | US$ in thousands | 1,369,100 | 1,499,400 | 1,664,100 | 1,302,800 | 1,249,000 |
| Total current liabilities | US$ in thousands | 939,300 | 1,047,900 | 1,314,100 | 1,000,100 | 825,400 |
| Current ratio | 1.46 | 1.43 | 1.27 | 1.30 | 1.51 |
October 31, 2023 calculation
Current ratio = Total current assets ÷ Total current liabilities
= $1,369,100K ÷ $939,300K
= 1.46
The current ratio is a liquidity ratio that measures a company's ability to meet its short-term liabilities with its short-term assets. A current ratio above 1 indicates that a company has more current assets than current liabilities, which is generally seen as a positive indicator.
Looking at Greif Inc's current ratio over the past five years, we can see that it has fluctuated within a relatively narrow range. In 2023, the current ratio stands at 1.46, which indicates that for every dollar of current liabilities, Greif Inc has $1.46 of current assets available to cover those obligations.
Comparing this to the previous years, the trend shows a slight improvement in the current ratio from 2021 to 2023, indicating that Greif Inc may have strengthened its ability to meet short-term obligations relative to its current asset base. However, it's important to note that the ratio fluctuated between 1.27 and 1.51 during this period.
The current ratio of 1.46 in 2023 suggests that Greif Inc has a healthy liquidity position, with a comfortable margin of current assets to cover its current liabilities. This may indicate that the company is capable of meeting its day-to-day operational and short-term financial obligations. However, it's crucial to also consider the composition and quality of current assets, as well as the nature of current liabilities, to fully assess the liquidity position.
In conclusion, Greif Inc's current ratio over the past five years has remained relatively stable, with the most recent figure of 1.46 indicating a healthy liquidity position in 2023. This suggests that the company has a sufficient level of current assets to meet its short-term obligations, which is a positive indicator for investors and creditors.