Otis Worldwide Corp (OTIS)
Quick ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 2,300,000 | 1,274,000 | 1,189,000 | 1,565,000 | 1,782,000 |
| Short-term investments | US$ in thousands | — | 1,230,000 | — | — | — |
| Receivables | US$ in thousands | 3,641,000 | 3,753,000 | 3,551,000 | 3,429,000 | 3,470,000 |
| Total current liabilities | US$ in thousands | 7,749,000 | 6,479,000 | 6,843,000 | 6,247,000 | 6,673,000 |
| Quick ratio | 0.77 | 0.97 | 0.69 | 0.80 | 0.79 |
December 31, 2024 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($2,300,000K
+ $—K
+ $3,641,000K)
÷ $7,749,000K
= 0.77
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. A quick ratio of less than 1 indicates that a company may have difficulty meeting its short-term liabilities.
Analyzing Otis Worldwide Corp's quick ratio over the past five years, we observe fluctuations in the ratio. As of December 31, 2020, the quick ratio was 0.79, which suggests that the company may have had some difficulty meeting its short-term obligations at that time. However, the ratio improved slightly to 0.80 by December 31, 2021, indicating a slight increase in liquidity.
By December 31, 2022, the quick ratio decreased to 0.69, potentially signaling a decrease in liquidity or an increase in short-term liabilities. The ratio then saw a significant improvement to 0.97 by December 31, 2023, which could indicate that the company was in a better position to meet its short-term financial commitments.
However, the quick ratio declined again to 0.77 by December 31, 2024, suggesting a decrease in liquidity compared to the previous year. Overall, fluctuations in the quick ratio of Otis Worldwide Corp over the past five years may indicate varying levels of liquidity and the company's ability to manage its short-term obligations.
Peer comparison
Dec 31, 2024