ODP Corp (ODP)
Quick ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 166,000 | 392,000 | 403,000 | 514,000 | 729,000 |
| Short-term investments | US$ in thousands | — | — | — | — | — |
| Receivables | US$ in thousands | — | — | — | — | — |
| Total current liabilities | US$ in thousands | 1,543,000 | 1,693,000 | 1,859,000 | 2,265,000 | 2,093,000 |
| Quick ratio | 0.11 | 0.23 | 0.22 | 0.23 | 0.35 |
December 31, 2024 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($166,000K
+ $—K
+ $—K)
÷ $1,543,000K
= 0.11
The quick ratio, also known as the acid-test ratio, measures a company's ability to meet its short-term obligations with its most liquid assets. ODP Corp's quick ratio has shown a declining trend over the past five years.
As of December 31, 2020, the quick ratio was 0.35, indicating that for every dollar of current liabilities, the company had $0.35 in quick assets to cover these obligations. However, by December 31, 2024, the quick ratio had decreased to 0.11, signaling a potential liquidity challenge as the quick ratio fell below 1, indicating that the company may struggle to meet its short-term liabilities using only its most liquid assets.
The declining trend in the quick ratio suggests that ODP Corp may need to improve its cash management or explore other financing options to enhance its liquidity position and meet its short-term financial obligations effectively and efficiently.
Peer comparison
Dec 31, 2024