Masco Corporation (MAS)
Cash ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 634,000 | 634,000 | 452,000 | 926,000 | 1,326,000 |
| Short-term investments | US$ in thousands | — | — | 452,000 | 926,000 | 1,326,000 |
| Total current liabilities | US$ in thousands | 1,560,000 | 1,695,000 | 1,889,000 | 1,939,000 | 1,934,000 |
| Cash ratio | 0.41 | 0.37 | 0.48 | 0.96 | 1.37 |
December 31, 2024 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($634,000K
+ $—K)
÷ $1,560,000K
= 0.41
The cash ratio of Masco Corporation has shown a downward trend over the past five years. In December 31, 2020, the cash ratio was at a relatively healthy level of 1.37, indicating that the company had $1.37 of cash and cash equivalents for every $1 of current liabilities. However, by December 31, 2024, the cash ratio had fallen to 0.41, implying a significant decrease in the company's ability to cover its short-term obligations with cash on hand.
This decreasing trend in the cash ratio suggests that Masco Corporation may be experiencing challenges in maintaining its liquidity position over time. A declining cash ratio could indicate potential difficulties in meeting its short-term financial obligations without relying on external financing or liquidating other assets.
It is imperative for Masco Corporation to closely monitor and manage its cash position to ensure it can withstand unexpected financial pressures and maintain financial stability in the future. Further analysis of the company's cash flow management and working capital practices may be warranted to address the declining trend in the cash ratio and ensure the company's financial health.
Peer comparison
Dec 31, 2024