United Parcel Service Inc (UPS)
Quick ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 6,112,000 | 3,206,000 | 5,602,000 | 10,255,000 | 5,910,000 |
| Short-term investments | US$ in thousands | 206,000 | 2,866,000 | 1,993,000 | 338,000 | 406,000 |
| Receivables | US$ in thousands | — | — | — | — | — |
| Total current liabilities | US$ in thousands | 16,441,000 | 17,676,000 | 18,140,000 | 17,569,000 | 17,016,000 |
| Quick ratio | 0.38 | 0.34 | 0.42 | 0.60 | 0.37 |
December 31, 2024 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($6,112,000K
+ $206,000K
+ $—K)
÷ $16,441,000K
= 0.38
The quick ratio of United Parcel Service Inc has shown fluctuations over the five-year period from 2020 to 2024. In 2020, the quick ratio was at a low of 0.37, indicating the company had limited liquid assets to cover its current liabilities. There was a significant improvement in 2021, with the quick ratio increasing to 0.60, which suggests an enhanced ability to meet short-term obligations with existing quick assets.
However, the quick ratio declined to 0.42 in 2022, indicating a slight decrease in liquidity compared to the previous year. By the end of 2023, the quick ratio further decreased to 0.34, raising concerns about the company's short-term liquidity position. The quick ratio slightly improved in 2024, reaching 0.38, but remained below the ideal benchmark of 1.0.
Overall, the fluctuations in the quick ratio over the five-year period suggest varying levels of liquidity risk for United Parcel Service Inc. It may be beneficial for the company to assess its current asset composition and liquidity management strategies to ensure adequate coverage of short-term obligations in the future.