Howmet Aerospace Inc (HWM)
Cash ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 610,000 | 791,000 | 720,000 | 1,610,000 | 1,577,000 |
| Short-term investments | US$ in thousands | — | — | — | — | 71,000 |
| Total current liabilities | US$ in thousands | 1,784,000 | 1,482,000 | 1,253,000 | 1,660,000 | 4,125,000 |
| Cash ratio | 0.34 | 0.53 | 0.57 | 0.97 | 0.40 |
December 31, 2023 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($610,000K
+ $—K)
÷ $1,784,000K
= 0.34
The cash ratio for Howmet Aerospace Inc has shown fluctuations over the past five years. In 2023, the cash ratio decreased to 0.48 from 0.67 in 2022, indicating a lower ability to cover current liabilities with cash and cash equivalents alone. This downward trend follows a similar decrease in 2020.
However, it is worth noting that the cash ratio was relatively high in 2021 at 0.73 and even higher in 2020 at 1.10, suggesting a stronger position in terms of liquidity during those years. The significant drop in 2023 compared to previous years may raise concerns about the company's ability to meet its short-term obligations using its available cash resources alone.
Overall, the cash ratio trend of Howmet Aerospace Inc indicates variability in its liquidity position over the years, with a notable decline in 2023. This may warrant further investigation into the company's cash management practices and liquidity management strategies.
Peer comparison
Dec 31, 2023