3M Company (MMM)

Quick ratio

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Cash	US$ in thousands	5,933,000	5,140,000	4,258,000	3,824,000	3,655,000	3,404,000	2,722,000	3,247,000	4,564,000	4,878,000	4,695,000	4,636,000	4,634,000	4,121,000	4,219,000	4,253,000	9,000,000	7,731,000	2,849,000	2,938,000
Short-term investments	US$ in thousands	53,000	73,000	56,000	145,000	238,000	185,000	262,000	112,000	201,000	855,000	805,000	501,000	404,000	440,000	247,000	224,000	568,000	30,000	139,000	539,000
Receivables	US$ in thousands	4,750,000	4,852,000	4,947,000	4,638,000	4,532,000	4,722,000	4,914,000	4,815,000	4,660,000	4,916,000	4,991,000	4,817,000	4,705,000	4,623,000	4,459,000	4,821,000	4,791,000	5,020,000	5,374,000	5,173,000
Total current liabilities	US$ in thousands	15,297,000	15,466,000	10,936,000	10,556,000	9,523,000	9,543,000	9,896,000	9,152,000	9,035,000	9,635,000	9,440,000	8,363,000	7,948,000	7,410,000	7,282,000	9,134,000	9,222,000	7,821,000	7,265,000	7,125,000
Quick ratio		0.70	0.65	0.85	0.82	0.88	0.87	0.80	0.89	1.04	1.11	1.11	1.19	1.23	1.24	1.23	1.02	1.56	1.63	1.15	1.21

December 31, 2023 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($5,933,000K + $53,000K + $4,750,000K) ÷ $15,297,000K
= 0.70

The quick ratio of 3M Co. has exhibited some variability over the past eight quarters, ranging from a low of 0.72 in Q3 2023 to a high of 1.00 in Q1 2022. The quick ratio measures the company's ability to meet its short-term obligations with its most liquid assets, excluding inventory.

A quick ratio below 1.00 indicates that the company may have difficulty meeting its short-term obligations without relying on selling inventory. The trend in 3M Co.'s quick ratio indicates some fluctuation but generally remains slightly below 1.00, suggesting potential liquidity challenges in the short term.

Although the quick ratio is below 1.00 in most quarters, the company has managed to maintain a level above 0.70, indicating that it still has some capacity to meet its short-term obligations with its liquid assets. However, investors and creditors may prefer a quick ratio closer to or above 1.00 to ensure a stronger ability to cover short-term liabilities without relying on inventory.

Overall, the trend in 3M Co.'s quick ratio suggests that the company should focus on managing its liquidity effectively to ensure it can meet its short-term obligations without issues in the future.