Valero Energy Corporation (VLO)
Cash ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 4,657,000 | 5,424,000 | 4,862,000 | 4,122,000 | 3,313,000 |
| Short-term investments | US$ in thousands | — | 111,000 | — | — | — |
| Total current liabilities | US$ in thousands | 15,495,000 | 16,802,000 | 17,461,000 | 16,851,000 | 9,283,000 |
| Cash ratio | 0.30 | 0.33 | 0.28 | 0.24 | 0.36 |
December 31, 2024 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($4,657,000K
+ $—K)
÷ $15,495,000K
= 0.30
The cash ratio is an important liquidity metric that helps assess a company's ability to cover short-term liabilities with its available cash and cash equivalents. A higher cash ratio indicates a stronger ability to meet short-term obligations.
Valero Energy Corporation's cash ratio has fluctuated over the years, starting at 0.36 on December 31, 2020, decreasing to 0.24 by December 31, 2021, then showing an improvement to 0.28 on December 31, 2022. Subsequently, the ratio increased further to 0.33 by December 31, 2023, before slightly decreasing to 0.30 by December 31, 2024.
The trend in Valero Energy Corporation's cash ratio indicates some volatility in its liquidity position. While the ratio decreased initially, it recovered and even improved in some subsequent years. This suggests that the company managed its cash position effectively to ensure it has enough liquid assets to cover its short-term liabilities.
Further analysis would be needed to understand the specific drivers behind these fluctuations and to determine the overall effectiveness of Valero Energy Corporation's cash management strategies in maintaining a healthy liquidity position.
Peer comparison
Dec 31, 2024