Kimberly-Clark Corporation (KMB)
Cash ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 1,093,000 | 427,000 | 270,000 | 303,000 | 442,000 |
| Short-term investments | US$ in thousands | — | — | — | 300,000 | — |
| Total current liabilities | US$ in thousands | 6,930,000 | 7,334,000 | 6,749,000 | 6,443,000 | 6,919,000 |
| Cash ratio | 0.16 | 0.06 | 0.04 | 0.09 | 0.06 |
December 31, 2023 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($1,093,000K
+ $—K)
÷ $6,930,000K
= 0.16
The cash ratio of Kimberly-Clark Corp. has shown a fluctuating trend over the past five years. The cash ratio, which is a measure of a company's ability to cover its short-term liabilities with its cash and cash equivalents, stood at 0.23 in 2023, indicating an improvement compared to the previous year. This suggests that the company had $0.23 in cash and cash equivalents for every $1 of its current liabilities at the end of 2023.
The upward trend in the cash ratio from 2022 to 2023 demonstrates an enhanced liquidity position of Kimberly-Clark Corp. and its ability to meet its short-term obligations more effectively. It is essential for companies to maintain adequate liquidity to handle any unforeseen financial challenges or capitalize on strategic opportunities.
Overall, the increasing cash ratio of Kimberly-Clark Corp. implies a strengthening cash position, which could be attributed to prudent cash management practices or improved operating performance. Stakeholders often view a higher cash ratio positively as it signifies a healthy financial position and lower liquidity risk for the company.
Peer comparison
Dec 31, 2023