Marriott International Inc (MAR)

The liquidity ratios of Marriott International, Inc. provide insights into the company's ability to meet its short-term obligations. The current ratio, which indicates the company's ability to cover short-term liabilities with current assets, has shown a declining trend from 2019 to 2023. The ratio was 0.47 in 2019, increased to 0.57 in 2021, but then decreased to 0.43 in 2023. This indicates that Marriott may be facing challenges in maintaining sufficient current assets to support its current liabilities.

Similarly, the quick ratio, which excludes inventory from current assets, has followed a similar trend to the current ratio. The quick ratio was also highest in 2021 at 0.57 and declined to 0.43 in 2023. This suggests that Marriott's ability to cover its short-term obligations with its most liquid assets has weakened over the years.

The cash ratio, which measures the company's ability to cover current liabilities with cash and cash equivalents, has fluctuated over the years. The ratio was highest in 2021 at 0.26 and lowest in 2019 at 0.07. In 2023, the cash ratio decreased to 0.08, indicating a slight reduction in Marriott's cash position relative to its current liabilities.

Overall, Marriott International, Inc.'s liquidity ratios suggest that the company may be facing challenges in maintaining adequate liquid assets to cover its short-term obligations. Management may need to closely monitor cash flow and working capital management to improve liquidity and ensure financial stability in the coming periods.

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See also:

Marriott International Inc Liquidity Ratios

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Additional liquidity measure

The cash conversion cycle of Marriott International, Inc. has shown a fluctuating trend over the past five years. The company's cash conversion cycle, which represents the time it takes to convert resources into cash flows, decreased from 61.05 days in 2020 to 41.74 days in 2023, indicating an improvement in cash management efficiency.

However, it is important to note that there was a significant increase in the cash conversion cycle from 2020 to 2021, where it reached 52.21 days, before starting to decline again in the subsequent years. This suggests some temporary challenges in managing cash flow and working capital in 2021.

Overall, Marriott International has demonstrated the ability to effectively manage its cash conversion cycle in recent years, with a general downward trend showcasing improvements in inventory turnover, accounts receivable collection, and accounts payable management. This indicates the company's efficiency in converting its investments in raw materials and resources into sales and cash flows. Tracking this metric can provide valuable insights into the company's operational efficiency and working capital management strategies.