Leggett & Platt Incorporated (LEG)
Quick ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 350,200 | 365,500 | 316,500 | 361,700 | 348,900 |
| Short-term investments | US$ in thousands | — | — | — | — | — |
| Receivables | US$ in thousands | — | — | — | — | — |
| Total current liabilities | US$ in thousands | 846,400 | 1,262,600 | 968,100 | 1,335,700 | 1,006,000 |
| Quick ratio | 0.41 | 0.29 | 0.33 | 0.27 | 0.35 |
December 31, 2024 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($350,200K
+ $—K
+ $—K)
÷ $846,400K
= 0.41
The quick ratio, also known as the acid-test ratio, is calculated by dividing a company's quick assets by its current liabilities. It measures a company's ability to meet its short-term obligations with its most liquid assets.
For Leggett & Platt Incorporated, the quick ratio has fluctuated over the past five years. As of December 31, 2020, the quick ratio was 0.35, indicating that the company had $0.35 of quick assets to cover each dollar of current liabilities. By December 31, 2021, the quick ratio had decreased to 0.27, suggesting a potential liquidity concern.
However, there was a slight improvement in the quick ratio by December 31, 2022, with a ratio of 0.33. This increase indicates a better ability to meet short-term obligations using quick assets. The quick ratio then dropped to 0.29 by the end of 2023, indicating potential challenges in liquidity management.
The most recent data as of December 31, 2024, shows a quick ratio of 0.41, which is an improvement from the previous year. A quick ratio higher than 1.0 is generally considered favorable as it suggests that a company has more than enough quick assets to cover its current liabilities.
Overall, Leggett & Platt Incorporated's quick ratio has shown fluctuations, with some years indicating potential liquidity concerns while others showing improvement. It is important for the company to monitor and manage its liquidity position to ensure it can meet its short-term obligations effectively.
Peer comparison
Dec 31, 2024