JM Smucker Company (SJM)
Current ratio
| Apr 30, 2024 | Apr 30, 2023 | Apr 30, 2022 | Apr 30, 2021 | Apr 30, 2020 | ||
|---|---|---|---|---|---|---|
| Total current assets | US$ in thousands | 1,966,900 | 2,858,700 | 2,010,100 | 1,941,700 | 1,972,700 |
| Total current liabilities | US$ in thousands | 3,761,100 | 1,986,700 | 1,952,800 | 2,867,500 | 1,587,100 |
| Current ratio | 0.52 | 1.44 | 1.03 | 0.68 | 1.24 |
April 30, 2024 calculation
Current ratio = Total current assets ÷ Total current liabilities
= $1,966,900K ÷ $3,761,100K
= 0.52
The current ratio of JM Smucker Company has exhibited significant fluctuations over the past five years. In the most recent fiscal year ending April 30, 2024, the current ratio dropped to 0.52, indicating a decline in the company's ability to cover its short-term obligations with its current assets. This significant decrease from the previous year's ratio of 1.44 raises concerns about the company's liquidity position and its ability to meet its immediate financial obligations.
Looking back at the trend over the past five years, there have been fluctuations in the current ratio, with periods of improvement followed by declines. For instance, in the fiscal year ending April 30, 2023, the company had a healthy current ratio of 1.44, indicating a strong ability to cover its short-term liabilities with current assets. However, this was preceded by a lower ratio of 1.03 in the previous year and further exacerbated by a significantly lower ratio of 0.68 in the fiscal year ending April 30, 2021.
The current ratio rebounded in the fiscal year ending April 30, 2020, with a ratio of 1.24, suggesting a more favorable liquidity position compared to the immediate preceding years. However, the recent decline in the current ratio to 0.52 highlights a potential liquidity strain for JM Smucker Company, requiring closer monitoring and potential management intervention to improve liquidity and ensure the company's ability to meet its short-term obligations.