International Business Machines (IBM)
Quick ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 13,068,000 | 7,886,000 | 6,650,000 | 13,188,000 | 8,172,000 |
| Short-term investments | US$ in thousands | 373,000 | 852,000 | 600,000 | 600,000 | 696,000 |
| Receivables | US$ in thousands | 7,725,000 | 14,209,000 | 14,977,000 | 18,738,000 | 23,795,000 |
| Total current liabilities | US$ in thousands | 34,122,000 | 31,505,000 | 33,619,000 | 39,869,000 | 37,701,000 |
| Quick ratio | 0.62 | 0.73 | 0.66 | 0.82 | 0.87 |
December 31, 2023 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($13,068,000K
+ $373,000K
+ $7,725,000K)
÷ $34,122,000K
= 0.62
The quick ratio of International Business Machines Corp. (IBM) has shown fluctuations over the past five years. In 2023, the quick ratio stands at 0.91, a slight increase from the previous year. The ratio indicates that for every $1 of current liabilities, IBM has $0.91 of quick assets readily available to cover those obligations.
Comparing it to the trend over the past five years, the quick ratio has generally been above 0.80, indicating a relatively strong liquidity position for IBM. However, it is worth noting that the ratio dipped in 2021 to 0.80 before recovering in the following years.
The slight improvement in the quick ratio in 2023 compared to 2022 suggests that IBM may have increased its ability to cover short-term obligations with quick assets. Investors and creditors typically view higher quick ratios favorably as they indicate a company's ability to meet its short-term financial commitments without relying heavily on inventory.
Overall, while the quick ratio for IBM has fluctuated, remaining consistently above 0.80 indicates that the company has maintained a reasonable level of liquidity, which is crucial for its financial stability and ability to navigate short-term financial challenges.
Peer comparison
Dec 31, 2023