Packaging Corp of America (PKG)
Quick ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 685,000 | 648,000 | 320,000 | 618,700 | 974,600 |
| Short-term investments | US$ in thousands | 102,000 | 493,500 | 85,200 | 86,100 | 105,600 |
| Receivables | US$ in thousands | — | — | — | — | — |
| Total current liabilities | US$ in thousands | 1,001,600 | 1,265,700 | 875,500 | 884,800 | 782,600 |
| Quick ratio | 0.79 | 0.90 | 0.46 | 0.80 | 1.38 |
December 31, 2024 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($685,000K
+ $102,000K
+ $—K)
÷ $1,001,600K
= 0.79
The quick ratio of Packaging Corp of America has shown varying trends over the past five years. As of December 31, 2020, the quick ratio was healthy at 1.38, indicating the company had sufficient liquid assets to cover its current liabilities. However, by December 31, 2021, the quick ratio decreased to 0.80, suggesting a potential strain on the company's ability to meet its short-term obligations with its most liquid assets.
The quick ratio further declined to 0.46 by December 31, 2022, signaling a significant decrease in the company's liquidity position. This could potentially raise concerns about its short-term financial health and ability to pay off immediate liabilities.
There was a slight improvement in the quick ratio by December 31, 2023, where it increased to 0.90. While still below the ideal ratio of 1, this uptick indicates some recovery in the company's liquidity position.
However, by December 31, 2024, the quick ratio fell again to 0.79, showing a slight decline in liquidity compared to the previous year. Overall, the fluctuating trend in Packaging Corp of America's quick ratio highlights the importance of closely monitoring the company's liquidity position to ensure it can meet its short-term financial obligations effectively.
Peer comparison
Dec 31, 2024