AT&T Inc (T)
Quick ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 3,298,000 | 6,722,000 | 3,701,000 | 19,223,000 | 7,924,000 |
| Short-term investments | US$ in thousands | — | 80,000 | 38,000 | 1,946,000 | 1,816,000 |
| Receivables | US$ in thousands | 9,638,000 | 10,289,000 | 11,466,000 | 17,571,000 | 20,215,000 |
| Total current liabilities | US$ in thousands | 46,872,000 | 51,127,000 | 56,173,000 | 106,230,000 | 63,438,000 |
| Quick ratio | 0.28 | 0.33 | 0.27 | 0.36 | 0.47 |
December 31, 2024 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($3,298,000K
+ $—K
+ $9,638,000K)
÷ $46,872,000K
= 0.28
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 higher quick ratio is typically preferred as it suggests the company is more capable of covering its short-term liabilities.
In the case of AT&T Inc, the quick ratio has been on a declining trend over the past five years. Starting at 0.47 on December 31, 2020, the ratio decreased to 0.36 by December 31, 2021, further dropping to 0.27 by December 31, 2022. There was a slight improvement to 0.33 by December 31, 2023, before falling again to 0.28 by December 31, 2024.
This downward trend indicates a potential liquidity concern, as the company may be facing challenges in meeting its short-term obligations with its quick assets. Further analysis of the company's cash position and management of current liabilities may be warranted to address this liquidity issue and ensure the company's financial health in the future.
Peer comparison
Dec 31, 2024