Trane Technologies plc (TT)
Current ratio
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Total current assets | US$ in thousands | 7,337,800 | 8,099,700 | 7,714,000 | 6,887,200 | 6,869,900 | 6,726,900 | 6,675,000 | 6,074,800 | 6,379,200 | 6,299,100 | 6,125,200 | 6,030,500 | 6,470,900 | 6,991,400 | 7,125,100 | 6,622,100 | 6,905,600 | 6,973,500 | 6,344,700 | 6,559,800 |
| Total current liabilities | US$ in thousands | 6,068,900 | 6,628,900 | 6,592,400 | 6,101,900 | 6,053,500 | 5,214,200 | 5,593,200 | 4,831,400 | 5,686,800 | 5,545,500 | 5,630,300 | 4,594,400 | 4,752,400 | 4,313,500 | 4,512,900 | 4,174,600 | 4,338,900 | 4,170,100 | 3,829,200 | 4,240,800 |
| Current ratio | 1.21 | 1.22 | 1.17 | 1.13 | 1.13 | 1.29 | 1.19 | 1.26 | 1.12 | 1.14 | 1.09 | 1.31 | 1.36 | 1.62 | 1.58 | 1.59 | 1.59 | 1.67 | 1.66 | 1.55 |
December 31, 2024 calculation
Current ratio = Total current assets ÷ Total current liabilities
= $7,337,800K ÷ $6,068,900K
= 1.21
Trane Technologies plc's current ratio has fluctuated over the periods indicated. The current ratio, which measures the company's ability to cover its short-term liabilities with its short-term assets, stood at 1.55 as of March 31, 2020, indicating the company had $1.55 in current assets for every dollar of current liabilities.
The ratio improved gradually to reach its peak at 1.67 on September 30, 2020, before fluctuating between 1.59 and 1.62 until December 31, 2021. However, there was a noticeable decline in the current ratio to 1.09 by June 30, 2022, suggesting a potential liquidity strain.
Though the ratio recovered to some extent in the following periods, hovering around 1.20 from March 31, 2024, to December 31, 2024, it remained below the ideal benchmark of 2. The declining trend in the current ratio may indicate a weakening ability to meet short-term obligations using current assets, which could raise concerns about the company's liquidity position. Further analysis of the company's current assets and current liabilities would provide deeper insights into its liquidity management.