Kellanova (K)
Quick ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 274,000 | 299,000 | 286,000 | 435,000 | 397,000 |
| Short-term investments | US$ in thousands | — | 49,000 | 14,000 | 4,000 | 0 |
| Receivables | US$ in thousands | 1,568,000 | 1,736,000 | 1,489,000 | 1,537,000 | 1,576,000 |
| Total current liabilities | US$ in thousands | 5,060,000 | 6,349,000 | 5,315,000 | 5,238,000 | 4,778,000 |
| Quick ratio | 0.36 | 0.33 | 0.34 | 0.38 | 0.41 |
December 31, 2023 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($274,000K
+ $—K
+ $1,568,000K)
÷ $5,060,000K
= 0.36
The quick ratio of Kellanova has been showing a declining trend over the past five years, decreasing from 0.41 in 2019 to 0.36 in 2023. This indicates that the company's ability to meet its short-term obligations with its most liquid assets has weakened over time. A quick ratio below 1.0 generally suggests that the company may have difficulty in paying off its current liabilities using its quick assets alone.
While the quick ratio has fluctuated slightly between 0.33 and 0.38 in recent years, the overall downward trajectory raises concerns about the company's liquidity position. Management should closely monitor this trend and consider strategies to improve the quick ratio, such as increasing cash reserves or reducing current liabilities. Additionally, investors and creditors may view a declining quick ratio unfavorably as it signals potential liquidity challenges for the company.
Peer comparison
Dec 31, 2023