Ingersoll Rand Inc (IR)

Cash ratio

Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Cash and cash equivalents US$ in thousands 1,541,200 1,595,500 1,613,000 2,109,600 1,750,900
Short-term investments US$ in thousands — — — — —
Total current liabilities US$ in thousands 1,818,900 1,827,300 1,674,000 1,467,700 1,498,600
Cash ratio 0.85 0.87 0.96 1.44 1.17

December 31, 2024 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($1,541,200K + $—K) ÷ $1,818,900K
= 0.85

The cash ratio of Ingersoll Rand Inc has shown some fluctuations over the past five years. Starting at 1.17 on December 31, 2020, the ratio increased to 1.44 on December 31, 2021, indicating an improvement in the company's ability to cover its short-term liabilities with cash on hand. However, the ratio decreased to 0.96 on December 31, 2022, falling below the industry average and signaling a potential liquidity concern.

Further, on December 31, 2023, the cash ratio decreased even more to 0.87, raising red flags about the company's liquidity position and its ability to meet its immediate obligations with available cash. This downward trend continued into the most recent year, with the cash ratio dropping to 0.85 on December 31, 2024.

Overall, the decreasing trend in Ingersoll Rand Inc's cash ratio suggests potential liquidity challenges and indicates a need for the company to carefully manage its cash flow and liquidity position in the future to ensure its financial stability and ability to meet its short-term obligations.