GE HealthCare Technologies Inc. (GEHC)
Quick ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | ||
|---|---|---|---|---|
| Cash | US$ in thousands | 2,874,000 | 2,494,000 | 1,440,000 |
| Short-term investments | US$ in thousands | 15,000 | — | — |
| Receivables | US$ in thousands | 102,000 | -1,000 | 3,409,000 |
| Total current liabilities | US$ in thousands | 9,553,000 | 8,981,000 | 7,191,000 |
| Quick ratio | 0.31 | 0.28 | 0.67 |
December 31, 2024 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($2,874,000K
+ $15,000K
+ $102,000K)
÷ $9,553,000K
= 0.31
The quick ratio of GE HealthCare Technologies Inc. has shown a declining trend over the past three years. As of December 31, 2022, the quick ratio was at 0.67, indicating that the company had $0.67 in liquid assets available to cover each dollar of current liabilities. However, by December 31, 2023, the quick ratio had decreased to 0.28, suggesting a significant deterioration in the company's short-term liquidity position. This downward trend continued into December 31, 2024, with the quick ratio slightly improving to 0.31, but still remaining at a relatively low level.
A quick ratio below 1 typically raises concerns about a company's ability to meet its short-term obligations using liquid assets alone. The declining quick ratio of GE HealthCare Technologies Inc. from 2022 to 2024 may indicate challenges in managing its short-term liquidity and potential difficulties in meeting immediate financial obligations without relying on selling inventory or obtaining additional financing.
Further analysis of the company's cash management, working capital practices, and overall financial health would be required to understand the underlying reasons for the downward trend in the quick ratio and assess the potential risks it poses to the company's financial stability.
Peer comparison
Dec 31, 2024