Martin Marietta Materials Inc (MLM)

Quick ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cash	US$ in thousands	1,271,800	358,000	258,400	207,300	21,000
Short-term investments	US$ in thousands	—	704,600	—	—	—
Receivables	US$ in thousands	771,600	804,800	790,800	587,400	590,600
Total current liabilities	US$ in thousands	1,170,200	1,445,600	752,600	499,300	838,500
Quick ratio		1.75	1.29	1.39	1.59	0.73

December 31, 2023 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($1,271,800K + $—K + $771,600K) ÷ $1,170,200K
= 1.75

The quick ratio of Martin Marietta Materials, Inc. has exhibited fluctuations over the past five years. In 2023, the quick ratio improved significantly to 1.81 compared to the previous year where it was at a lower level of 0.85. This indicates a stronger short-term liquidity position in 2023, with the ability to cover current liabilities more than twice over with its quick assets.

In 2022, the quick ratio was relatively low at 0.85, suggesting a potential liquidity strain and a risk of difficulties in meeting immediate obligations with the available quick assets. However, in 2021, the quick ratio rebounded to a healthier level of 1.56, showing an improvement in liquidity compared to the previous year.

The trend continues with a quick ratio of 1.73 in 2020, indicating a good short-term liquidity position that year. In 2019, the quick ratio stood at 0.88, marking lower liquidity compared to the subsequent years.

Overall, the fluctuation in the quick ratio of Martin Marietta Materials, Inc. over the past five years suggests varying levels of short-term liquidity. Companies generally aim for a quick ratio of at least 1 to ensure they have adequate liquid assets to cover immediate liabilities. It is essential for investors and stakeholders to monitor these ratios to assess the company's ability to meet short-term obligations.