Solventum Corp. (SOLV)
Quick ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 762,000 | 600,000 | 61,000 | 91,000 | — |
| Short-term investments | US$ in thousands | — | 406,000 | — | — | — |
| Receivables | US$ in thousands | — | — | — | — | — |
| Total current liabilities | US$ in thousands | 2,703,000 | 1,771,000 | 1,311,000 | 1,406,000 | — |
| Quick ratio | 0.28 | 0.57 | 0.05 | 0.06 | — |
December 31, 2024 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($762,000K
+ $—K
+ $—K)
÷ $2,703,000K
= 0.28
The quick ratio of Solventum Corp. indicates the company's ability to meet its short-term obligations with its most liquid assets.
Looking at the trend over the years, the quick ratio was not available for December 31, 2020. In December 2021 and 2022, the quick ratio was quite low at 0.06 and 0.05 respectively, suggesting that the company had limited liquid assets relative to its current liabilities during those periods.
However, there was a significant improvement in the quick ratio by December 31, 2023, jumping to 0.57. This indicates that Solventum Corp. had a better ability to cover its short-term liabilities with its quick assets at the end of 2023.
By December 31, 2024, the quick ratio declined to 0.28. While still an improvement from the earlier years, it suggests that Solventum Corp. may have experienced a reduction in its ability to quickly meet its short-term obligations compared to the previous year.
In conclusion, Solventum Corp. showed fluctuations in its quick ratio over the years, indicating varying levels of liquidity and ability to fulfill short-term obligations. Constant monitoring and management of liquidity are essential for the company to maintain its financial stability and meet its short-term commitments effectively.
Peer comparison
Dec 31, 2024