Genuine Parts Co (GPC)
Quick ratio
| 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 | US$ in thousands | 1,102,010 | 654,637 | 530,105 | 651,183 | 653,463 | 629,198 | 519,131 | 610,776 | 714,701 | 919,097 | 987,389 | 1,117,990 | 990,166 | 900,123 | 983,759 | 354,469 | 276,992 | 451,275 | 562,551 | 356,925 |
| Short-term investments | US$ in thousands | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — |
| Receivables | US$ in thousands | 2,223,430 | 2,394,790 | 2,554,170 | 2,420,850 | 2,188,870 | 2,215,030 | 2,235,450 | 2,137,810 | 1,797,960 | 1,888,250 | 1,899,980 | 1,809,640 | 1,556,970 | 1,952,220 | 1,823,360 | 2,705,190 | 2,635,160 | 2,739,970 | 2,836,880 | 2,741,920 |
| Total current liabilities | US$ in thousands | 7,827,110 | 7,800,360 | 7,899,790 | 7,917,520 | 7,686,110 | 7,495,120 | 7,293,860 | 7,249,530 | 6,581,580 | 6,537,320 | 6,521,200 | 6,336,350 | 5,894,080 | 5,976,700 | 5,968,730 | 6,581,220 | 6,394,120 | 6,372,810 | 6,498,230 | 6,545,330 |
| Quick ratio | 0.42 | 0.39 | 0.39 | 0.39 | 0.37 | 0.38 | 0.38 | 0.38 | 0.38 | 0.43 | 0.44 | 0.46 | 0.43 | 0.48 | 0.47 | 0.46 | 0.46 | 0.50 | 0.52 | 0.47 |
December 31, 2023 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($1,102,010K
+ $—K
+ $2,223,430K)
÷ $7,827,110K
= 0.42
The quick ratio, also known as the acid-test ratio, measures a company's ability to meet its short-term obligations with its most liquid assets. Genuine Parts Co.'s quick ratio has shown some fluctuation over the past eight quarters, ranging from 0.57 to 0.63.
The quick ratio of Genuine Parts Co. has generally remained below 1.0, indicating that the company may have difficulty meeting its current liabilities using only its most liquid assets. A quick ratio below 1.0 suggests a potential liquidity risk as the company may not be able to cover its short-term obligations without relying on other sources of liquidity.
The trend over the past eight quarters shows that the quick ratio has fluctuated within a relatively narrow range, with a slight improvement in Q4 2023 compared to the previous quarters. However, the ratio remains consistently below 1.0, indicating the ongoing need for Genuine Parts Co. to closely monitor its liquidity position.
In conclusion, Genuine Parts Co.'s quick ratio performance suggests a potential liquidity challenge, and the company may need to evaluate its liquidity management strategies to ensure it can meet its short-term obligations effectively.