Thermo Fisher Scientific Inc (TMO)

Liquidity ratios

Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Current ratio 1.75 1.63 1.42 1.27 1.48 1.74 1.65 1.56 1.50 3.19 2.78 2.53 2.13 2.93 2.62 2.32 1.92 1.80 1.49 1.69
Quick ratio 1.16 1.03 0.79 0.22 0.98 0.26 0.17 0.24 0.93 1.55 1.02 0.82 1.00 1.32 0.97 0.56 0.39 0.22 0.31 0.19
Cash ratio 0.58 0.43 0.22 0.22 0.50 0.26 0.17 0.24 0.33 1.55 1.02 0.82 1.00 1.32 0.97 0.56 0.39 0.22 0.31 0.19

Thermo Fisher Scientific Inc.'s liquidity ratios exhibit certain trends over the past eight quarters.

The current ratio, which measures the company's ability to pay its short-term obligations with its current assets, has shown fluctuations but generally maintains a healthy level above 1. This indicates that the company has ample current assets to cover its current liabilities.

The quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, has also varied over the quarters. While it generally stays above 1, indicating the company's ability to meet its short-term liabilities without relying on selling inventory, it has shown some signs of weakening in the most recent quarters.

The cash ratio, the most conservative liquidity measure that looks at a company's ability to cover its current liabilities with cash and cash equivalents, has demonstrated a decreasing trend over the quarters. This suggests that the company's ability to pay off its short-term obligations solely with its cash reserves has weakened somewhat.

Overall, Thermo Fisher Scientific Inc. shows reasonable liquidity levels based on these ratios, with current and quick ratios above 1 indicating good short-term financial health. However, the decreasing trend in the cash ratio may warrant further scrutiny to ensure the company's ability to meet its obligations with cash remains adequate in the future.

See also:

Thermo Fisher Scientific Inc Liquidity Ratios (Quarterly Data)

Additional liquidity measure

Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Cash conversion cycle days 149.59 171.70 178.49 96.65 147.11 116.27 112.47 106.05 164.79 109.95 111.99 99.61 86.71 106.72 114.44 95.73 75.31 72.26 80.39 73.55

The cash conversion cycle of Thermo Fisher Scientific Inc. has exhibited fluctuations over the past eight quarters. The company's cash conversion cycle has ranged from 97.64 days to 118.44 days during this period.

In general, a shorter cash conversion cycle indicates that the company is able to efficiently convert its investments in inventory into cash flow. Conversely, a longer cash conversion cycle may suggest inefficiencies in managing inventory, collecting receivables, or paying suppliers.

Analyzing the trend, it is observed that there was a decrease in the cash conversion cycle from Q2 2022 to Q3 2022, followed by an increase in Q4 2022. This pattern continued into Q1 2023 with a slight decrease, but then increased again in Q2 2023 and peaked in Q3 2023 before decreasing slightly in Q4 2023.

Overall, Thermo Fisher Scientific Inc. has shown variability in its cash conversion cycle, indicating potential fluctuations in its working capital management efficiency. It is important for the company to closely monitor and manage its cash conversion cycle to ensure optimal utilization of resources and maintain strong liquidity position.