Sempra Energy (SRE)
Quick ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 1,565,000 | 236,000 | 370,000 | 559,000 | 960,000 |
| Short-term investments | US$ in thousands | 23,234,000 | -49,000 | -14,809,000 | — | 12,440,000 |
| Receivables | US$ in thousands | 2,086,000 | 2,276,000 | 2,802,000 | 2,173,000 | 1,711,000 |
| Total current liabilities | US$ in thousands | 9,676,000 | 10,090,000 | 9,899,000 | 10,035,000 | 6,839,000 |
| Quick ratio | 2.78 | 0.24 | -1.18 | 0.27 | 2.21 |
December 31, 2024 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($1,565,000K
+ $23,234,000K
+ $2,086,000K)
÷ $9,676,000K
= 2.78
The quick ratio, also known as the acid-test ratio, measures a company's ability to meet its short-term obligations with its most liquid assets. A quick ratio above 1 indicates that a company has enough liquid assets to cover its current liabilities.
Based on the data provided for Sempra Energy:
- As of December 31, 2020, the quick ratio was 2.21, indicating a strong ability to cover short-term obligations with liquid assets.
- By December 31, 2021, the quick ratio dropped significantly to 0.27, suggesting a potential liquidity strain or difficulty in meeting short-term obligations.
- The quick ratio further deteriorated to -1.18 by December 31, 2022, which raises concerns about the company's ability to cover immediate liabilities with available liquid assets.
- However, there was a slight improvement by December 31, 2023, with the quick ratio increasing to 0.24, but it still remains below 1, indicating continued challenges in liquidity.
- By December 31, 2024, the quick ratio significantly improved to 2.78, surpassing the ideal threshold of 1 and signaling a strengthened ability to meet short-term obligations with liquid assets.
Overall, fluctuations in Sempra Energy's quick ratio over the years suggest varying levels of liquidity and potential challenges in managing short-term obligations, with notable improvements seen in the later years of the period.
Peer comparison
Dec 31, 2024