Timken Company (TKR)
Cash ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 373,200 | 418,900 | 331,600 | 257,100 | 320,300 |
| Short-term investments | US$ in thousands | — | 31,600 | 39,200 | 56,900 | 37,600 |
| Total current liabilities | US$ in thousands | 820,500 | 1,471,300 | 1,012,400 | 896,600 | 848,000 |
| Cash ratio | 0.45 | 0.31 | 0.37 | 0.35 | 0.42 |
December 31, 2024 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($373,200K
+ $—K)
÷ $820,500K
= 0.45
The cash ratio of Timken Company has shown some fluctuations over the past five years. Starting at 0.42 on December 31, 2020, it decreased to 0.35 by December 31, 2021, but then slightly increased to 0.37 by December 31, 2022. However, by the end of December 31, 2023, the cash ratio dropped to 0.31. Subsequently, there was a notable improvement with the cash ratio rising to 0.45 as of December 31, 2024.
Overall, while the cash ratio fluctuated over the period, it appears to have strengthened by the end of the five-year period, indicating that Timken Company had a higher level of cash and cash equivalents relative to its current liabilities by the end of 2024 compared to the beginning of 2020. This improved cash ratio could suggest better liquidity and the ability to cover short-term obligations effectively. It is essential for Timken Company to maintain a healthy cash ratio to ensure operational stability and financial flexibility in the future.
Peer comparison
Dec 31, 2024