Tempur Sealy International Inc (TPX)
Current ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total current assets | US$ in thousands | 1,103,200 | 1,195,200 | 1,275,600 | 968,400 | 900,200 |
| Total current liabilities | US$ in thousands | 908,200 | 981,200 | 1,053,400 | 974,800 | 773,300 |
| Current ratio | 1.21 | 1.22 | 1.21 | 0.99 | 1.16 |
December 31, 2023 calculation
Current ratio = Total current assets ÷ Total current liabilities
= $1,103,200K ÷ $908,200K
= 1.21
The current ratio of Tempur Sealy International Inc has shown a relatively stable trend over the past five years. It increased from 1.16 in 2019 to 1.22 in 2022 before slightly decreasing to 1.21 in 2023. The ratio indicates that the company has adequate current assets to cover its current liabilities, with a general ability to meet its short-term obligations.
However, the current ratio decreased to 0.99 in 2020, which briefly raised concerns about the company's liquidity position as its current liabilities exceeded its current assets during that year. Since then, the company has made improvements to its liquidity position by increasing the current ratio back above 1, providing a more comfortable buffer for meeting short-term obligations.
In general, a current ratio above 1 indicates the company's ability to pay off its short-term obligations using its current assets. Investors and creditors typically view a current ratio above 1 as a positive indicator of a company's short-term financial health.
Peer comparison
Dec 31, 2023