United Rentals Inc (URI)
Quick ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 363,000 | 106,000 | 144,000 | 202,000 | 52,000 |
| Short-term investments | US$ in thousands | — | — | — | — | — |
| Receivables | US$ in thousands | 2,230,000 | 2,004,000 | 1,677,000 | 1,315,000 | 1,530,000 |
| Total current liabilities | US$ in thousands | 3,637,000 | 2,445,000 | 2,603,000 | 1,890,000 | 2,198,000 |
| Quick ratio | 0.71 | 0.86 | 0.70 | 0.80 | 0.72 |
December 31, 2023 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($363,000K
+ $—K
+ $2,230,000K)
÷ $3,637,000K
= 0.71
The quick ratio, also known as the acid-test ratio, measures a company's ability to meet its short-term obligations using its most liquid assets. It is calculated by dividing the sum of cash, cash equivalents, and accounts receivable by current liabilities.
United Rentals, Inc.'s quick ratio has fluctuated over the past five years. In 2023, the quick ratio stood at 0.75, indicating that for every dollar of current liabilities, the company had $0.75 of quick assets available to cover them. This represents a decline from the previous year's quick ratio of 1.02.
The 2023 quick ratio of 0.75 implies a lower level of liquidity compared to 2022, which might raise concerns about the company's ability to meet its short-term obligations. A declining trend in the quick ratio could suggest potential liquidity challenges or inefficiencies in managing the company's current assets and liabilities.
It's important to monitor the trend of the quick ratio over time and compare it to industry benchmarks to assess United Rentals, Inc.'s liquidity position accurately and evaluate its short-term financial health.
Peer comparison
Dec 31, 2023