Hormel Foods Corporation (HRL)
Current ratio
| Oct 29, 2023 | Oct 30, 2022 | Oct 31, 2021 | Oct 25, 2020 | Oct 27, 2019 | ||
|---|---|---|---|---|---|---|
| Total current assets | US$ in thousands | 3,297,250 | 3,637,120 | 2,947,820 | 3,579,060 | 2,361,410 |
| Total current liabilities | US$ in thousands | 2,311,780 | 1,473,270 | 1,415,650 | 1,503,960 | 1,105,050 |
| Current ratio | 1.43 | 2.47 | 2.08 | 2.38 | 2.14 |
October 29, 2023 calculation
Current ratio = Total current assets ÷ Total current liabilities
= $3,297,250K ÷ $2,311,780K
= 1.43
The current ratio of Hormel Foods Corp. has exhibited some fluctuations over the past five years. In 2023, the current ratio decreased to 1.43 from 2.47 in 2022. This indicates a decline in the company's ability to meet its short-term obligations with its current assets, potentially signaling a decrease in liquidity.
It is important to note that while a current ratio above 1.0 generally implies that a company can meet its short-term liabilities, a higher current ratio is typically preferred as it suggests a stronger ability to cover these obligations. Therefore, the decrease in the current ratio from 2022 to 2023 may warrant further investigation into the company's current asset management and liquidity position.