3M Company (MMM)

Cash ratio

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Cash and cash equivalents	US$ in thousands	5,600,000	5,933,000	3,655,000	4,564,000	4,634,000
Short-term investments	US$ in thousands	2,128,000	53,000	238,000	201,000	404,000
Total current liabilities	US$ in thousands	11,256,000	15,297,000	9,523,000	9,035,000	7,948,000
Cash ratio		0.69	0.39	0.41	0.53	0.63

December 31, 2024 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($5,600,000K + $2,128,000K) ÷ $11,256,000K
= 0.69

The cash ratio of 3M Company has shown fluctuations over the past five years. The ratio was 0.63 as of December 31, 2020, indicating that the company had $0.63 in cash and cash equivalents for every $1 of current liabilities.

However, there was a decrease in the cash ratio to 0.53 by the end of 2021, suggesting a potential decrease in liquidity as the company had less cash available to cover its short-term obligations. This trend continued into 2022 and 2023 with the cash ratio declining further to 0.41 and 0.39, respectively.

The cash ratio then improved significantly to 0.69 by December 31, 2024, indicating a stronger liquidity position compared to the previous years. This increase could signify better cash management practices or an increase in available cash relative to current liabilities.

Overall, the trend in 3M Company's cash ratio suggests fluctuations in liquidity over the past five years, with a notable improvement in 2024. It is important for stakeholders to monitor this ratio to assess the company's ability to meet its short-term obligations using its available cash reserves.