Leggett & Platt Incorporated (LEG)
Quick ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 365,500 | 316,500 | 361,700 | 348,900 | 247,600 |
| Short-term investments | US$ in thousands | — | — | — | — | — |
| Receivables | US$ in thousands | 697,000 | 609,000 | 620,000 | 563,600 | 591,900 |
| Total current liabilities | US$ in thousands | 1,262,600 | 968,100 | 1,335,700 | 1,006,000 | 928,100 |
| Quick ratio | 0.84 | 0.96 | 0.73 | 0.91 | 0.90 |
December 31, 2023 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($365,500K
+ $—K
+ $697,000K)
÷ $1,262,600K
= 0.84
The quick ratio of Leggett & Platt, Inc. has shown some fluctuations over the past five years, ranging from 0.80 to 1.09. A quick ratio below 1 indicates that the company may have difficulty meeting its short-term obligations using its most liquid assets.
In 2023, the quick ratio decreased to 0.84 from 1.09 in 2022, which is a concerning trend as it suggests a decline in the company's ability to cover its current liabilities with its quick assets. This may be indicative of challenges in managing short-term liquidity or a reduction in the proportion of highly liquid assets relative to current liabilities.
Although the quick ratio fluctuated over the years, it is essential to evaluate the trend over time and in comparison to industry benchmarks. Further analysis is recommended to assess the underlying factors impacting the quick ratio and determine if any operational or financial adjustments are necessary to improve the company's short-term liquidity position.
Peer comparison
Dec 31, 2023