Motorola Solutions Inc (MSI)

Liquidity ratios

Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 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
Current ratio 1.28 1.25 1.19 1.19 0.99 0.95 1.23 1.22 1.15 1.25 1.16 1.10 1.33 1.38 1.46 1.27 1.24 1.20 1.17 1.16
Quick ratio 0.42 0.30 0.30 0.33 0.30 0.17 0.19 0.26 0.29 0.22 0.19 0.23 0.46 0.48 0.60 0.43 0.40 0.63 0.43 0.47
Cash ratio 0.42 0.30 0.30 0.33 0.30 0.17 0.19 0.26 0.29 0.22 0.19 0.23 0.46 0.48 0.60 0.43 0.40 0.63 0.43 0.47

Motorola Solutions Inc's current ratio has fluctuated over the years, indicating changes in its short-term liquidity position. The ratio started at 1.16 as of March 31, 2020, reached its peak at 1.46 on June 30, 2021, and has since stabilized around 1.25 by December 31, 2024. The current ratio above 1 suggests the company's ability to meet its short-term obligations using its current assets.

The quick ratio, which excludes inventory from current assets, offers a more conservative measure of liquidity. Motorola's quick ratio has shown variability, with lower values compared to the current ratio. The quick ratio was lowest at 0.17 on September 30, 2023, and has gradually improved to 0.30 by December 31, 2024. This indicates the company's ability to cover immediate liabilities without relying on inventory.

The cash ratio, being the most stringent measure of liquidity, also reflects fluctuations over time. Motorola's cash ratio pattern is similar to the quick ratio, with the lowest value of 0.17 on September 30, 2023, and a slightly higher value of 0.42 by December 31, 2024. This indicates the company's capacity to cover its short-term liabilities using only its cash and cash equivalents.

In conclusion, Motorola Solutions Inc has managed to maintain a current ratio above 1, indicating overall healthy short-term liquidity. The quick and cash ratios provide additional insights into the company's ability to meet its obligations with more liquid assets. Overall, the increasing trend in these ratios towards the end of the period suggests an improvement in the company's liquidity position.


See also:

Motorola Solutions Inc Liquidity Ratios (Quarterly Data)


Additional liquidity measure

Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 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
Cash conversion cycle days 51.97 55.67 55.63 59.44 59.88 70.50 74.00 79.51 78.86 90.55 89.17 81.70 69.62 53.50 50.78 50.23 48.72 46.54 42.42 40.95

The cash conversion cycle (CCC) provides insight into how efficiently Motorola Solutions Inc manages its working capital by measuring the time it takes to convert its resources into cash flows. From March 31, 2020, to June 30, 2024, the CCC of Motorola Solutions Inc fluctuated, indicating changes in its operational efficiency.

The CCC for the company increased from 40.95 days on March 31, 2020, to 89.17 days on June 30, 2022, indicating a deterioration in its efficiency in managing cash flows. This significant increase suggests that the company may be experiencing challenges in managing its working capital effectively, leading to a longer cash conversion cycle.

However, the CCC decreased from 89.17 days on June 30, 2022, to 51.97 days on December 31, 2024, demonstrating an improvement in managing working capital efficiently. This reduction in the CCC suggests that Motorola Solutions Inc may have implemented strategies to optimize its cash flow processes, resulting in quicker conversions of resources into cash.

Overall, monitoring the trend of Motorola Solutions Inc's CCC is crucial for assessing its liquidity, operational efficiency, and ability to meet short-term obligations. An increasing CCC may indicate potential financial constraints, while a decreasing CCC signifies enhanced operational effectiveness and stronger financial performance.