Sonoco Products Company (SON)
Current ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Total current assets | US$ in thousands | 3,178,560 | 2,050,360 | 2,398,220 | 1,658,680 | 1,830,550 |
| Total current liabilities | US$ in thousands | 4,038,290 | 1,165,280 | 1,774,600 | 1,525,760 | 1,511,630 |
| Current ratio | 0.79 | 1.76 | 1.35 | 1.09 | 1.21 |
December 31, 2024 calculation
Current ratio = Total current assets ÷ Total current liabilities
= $3,178,560K ÷ $4,038,290K
= 0.79
Based on the data provided, Sonoco Products Company's current ratio has shown fluctuations over the past five years. The current ratio was 1.21 on December 31, 2020, indicating that the company had $1.21 in current assets for every $1 in current liabilities.
However, by December 31, 2021, the current ratio decreased to 1.09, suggesting a potential challenge in meeting short-term obligations with current assets. This could be a concern for creditors and investors as the company's liquidity position weakened.
In the following years, the current ratio improved significantly, reaching 1.35 on December 31, 2022, and further increasing to 1.76 by December 31, 2023. These higher ratios imply that Sonoco had a more comfortable liquidity position, with more current assets to cover its current liabilities.
Interestingly, by December 31, 2024, the current ratio dropped to 0.79, which may raise concerns about the company's ability to meet short-term obligations with its current assets. A current ratio below 1 suggests that the company may have difficulties in paying off its current liabilities with its existing current assets.
In conclusion, while Sonoco Products Company experienced fluctuations in its current ratio over the five-year period, the company needs to closely monitor and manage its liquidity position to ensure it can meet its short-term obligations effectively.
Peer comparison
Dec 31, 2024