Thermo Fisher Scientific Inc (TMO)

Cash ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cash and cash equivalents	US$ in thousands	8,077,000	8,524,000	4,477,000	10,325,000	2,399,000
Short-term investments	US$ in thousands	—	2,000	—	28,000	37,000
Total current liabilities	US$ in thousands	14,012,000	17,010,000	13,436,000	10,304,000	6,197,000
Cash ratio		0.58	0.50	0.33	1.00	0.39

December 31, 2023 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($8,077,000K + $—K) ÷ $14,012,000K
= 0.58

The cash ratio of Thermo Fisher Scientific Inc. has exhibited fluctuating trends over the past five years. The ratio was 0.67 in 2019 and 2022, indicating that the company had slightly more cash and cash equivalents to cover its current liabilities during those years. In 2020, the ratio increased significantly to 1.18, suggesting a strengthened ability to meet short-term obligations with available cash.

However, the cash ratio decreased to 0.53 in 2021, indicating a reduced capacity to cover immediate liabilities with cash on hand. This decline may raise concerns about the company's liquidity position and its ability to handle short-term financial obligations.

In 2023, the cash ratio improved to 0.81, showing a recovery from the lower ratio in 2021 but remaining below the peak level observed in 2020. Overall, the fluctuating cash ratio of Thermo Fisher Scientific Inc. reflects varying levels of liquidity and highlights the importance of carefully managing cash resources to ensure financial stability and operational continuity.