The Wendy’s Co (WEN)
Current ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total current assets | US$ in thousands | 837,653 | 1,058,280 | 592,849 | 687,623 | 554,047 |
| Total current liabilities | US$ in thousands | 381,930 | 387,999 | 426,925 | 413,308 | 349,698 |
| Current ratio | 2.19 | 2.73 | 1.39 | 1.66 | 1.58 |
December 31, 2023 calculation
Current ratio = Total current assets ÷ Total current liabilities
= $837,653K ÷ $381,930K
= 2.19
The current ratio of Wendy's Co has shown fluctuations over the past five years. In 2023, the current ratio stands at 2.19, indicating that the company has $2.19 in current assets for every $1 of current liabilities. This represents a decrease from the previous year's ratio of 2.73. The significant drop in the current ratio from 2022 to 2023 may raise concerns about the company's short-term liquidity position.
Comparing the current ratio to the ratios of 2021 and 2020, Wendy's Co has shown an improvement in liquidity since those years when the ratios were 1.39 and 1.66 respectively. However, the current ratio of 2.19 in 2023 is still lower than the 2019 ratio of 1.58.
Overall, while Wendy's Co has improved its liquidity position from 2021 and 2020, the recent decrease in the current ratio from 2022 to 2023 may raise questions about the company's ability to meet its short-term obligations with its current assets. It is essential for stakeholders to monitor the trend of the current ratio in the coming periods to assess the company's liquidity risk.
Peer comparison
Dec 31, 2023