Stepan Company (SCL)
Current ratio
| 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Total current assets | US$ in thousands | 810,429 | 918,158 | 867,140 | 869,806 | 851,883 | 849,436 | 938,722 | 1,006,520 | 1,044,800 | 1,072,750 | 1,087,370 | 1,081,870 | 913,368 | 839,213 | 815,855 | 797,653 | 905,651 | 833,036 | 796,376 | 768,544 |
| Total current liabilities | US$ in thousands | 669,034 | 721,293 | 655,195 | 628,853 | 607,870 | 582,077 | 642,037 | 662,744 | 670,649 | 603,245 | 638,228 | 611,062 | 500,476 | 491,065 | 464,501 | 464,089 | 416,554 | 361,166 | 319,172 | 310,158 |
| Current ratio | 1.21 | 1.27 | 1.32 | 1.38 | 1.40 | 1.46 | 1.46 | 1.52 | 1.56 | 1.78 | 1.70 | 1.77 | 1.82 | 1.71 | 1.76 | 1.72 | 2.17 | 2.31 | 2.50 | 2.48 |
December 31, 2024 calculation
Current ratio = Total current assets ÷ Total current liabilities
= $810,429K ÷ $669,034K
= 1.21
Stepan Company's current ratio has shown a declining trend over the past few years. The current ratio measures the company's ability to cover its short-term liabilities with its current assets. A higher current ratio is generally preferred as it indicates a stronger liquidity position.
From March 31, 2020, to December 31, 2021, Stepan Company's current ratio remained relatively stable, ranging between 2.17 and 2.50. However, starting from March 31, 2022, the current ratio started to decline, dropping to 1.21 by December 31, 2024.
The decreasing trend in the current ratio may indicate potential liquidity challenges for the company in meeting its short-term financial obligations. A current ratio below 1 suggests that the company may struggle to pay off its current liabilities using its current assets.
It is recommended for Stepan Company to closely monitor its liquidity position, review its current asset management practices, and possibly consider strategies to improve its current ratio to ensure financial stability and meet short-term obligations effectively.
Peer comparison
Dec 31, 2024