Southern Company (SO)
Current ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total current assets | US$ in thousands | 10,432,000 | 10,416,000 | 8,965,000 | 8,617,000 | 9,817,000 |
| Total current liabilities | US$ in thousands | 13,467,000 | 15,724,000 | 10,921,000 | 12,079,000 | 12,546,000 |
| Current ratio | 0.77 | 0.66 | 0.82 | 0.71 | 0.78 |
December 31, 2023 calculation
Current ratio = Total current assets ÷ Total current liabilities
= $10,432,000K ÷ $13,467,000K
= 0.77
The current ratio of Southern Company has fluctuated over the past five years, ranging from 0.66 to 0.82. The ratio indicates that in recent years, the company's current assets may not have been sufficient to cover its current liabilities.
Specifically, the current ratio stood at 0.77 as of December 31, 2023, which suggests that the company had $0.77 in current assets for every $1 of current liabilities. This may raise concerns about the company's short-term liquidity and ability to meet its short-term obligations.
On a positive note, the current ratio of 0.82 as of December 31, 2021, was relatively higher, indicating a slightly stronger liquidity position compared to the other years. However, the company's current ratio has generally been below 1.0, suggesting potential liquidity challenges.
Overall, Southern Company's current ratio trend indicates that the company may need to focus on managing its current assets and liabilities more effectively to improve its liquidity position and meet its short-term obligations more comfortably.
Peer comparison
Dec 31, 2023