McCormick & Company Incorporated (MKC)
Current ratio
| Nov 30, 2023 | Nov 30, 2022 | Nov 30, 2021 | Nov 30, 2020 | Nov 30, 2019 | ||
|---|---|---|---|---|---|---|
| Total current assets | US$ in thousands | 2,001,600 | 2,386,700 | 2,195,800 | 2,083,600 | 1,550,200 |
| Total current liabilities | US$ in thousands | 3,098,900 | 3,432,400 | 3,223,800 | 3,046,500 | 2,154,400 |
| Current ratio | 0.65 | 0.70 | 0.68 | 0.68 | 0.72 |
November 30, 2023 calculation
Current ratio = Total current assets ÷ Total current liabilities
= $2,001,600K ÷ $3,098,900K
= 0.65
The current ratio measures a company's ability to meet its short-term obligations with its current assets. A higher current ratio is generally considered favorable, indicating a stronger ability to cover short-term liabilities. McCormick & Co., Inc.'s current ratio has declined from 0.72 in 2019 to 0.65 in 2023. This suggests a potential weakening in the company's short-term liquidity position over the years.
In 2023, the current assets may not be sufficient to cover the current liabilities, raising concerns about the company's ability to pay off its short-term obligations. It may indicate increased reliance on short-term borrowing or a decrease in liquid assets. Further assessment of the composition of current assets and liabilities would be necessary to fully evaluate the company's short-term financial health.