Weatherford International PLC (WFRD)
Cash ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 916,000 | 958,000 | 910,000 | 951,000 | 1,118,000 |
| Short-term investments | US$ in thousands | — | — | — | — | — |
| Total current liabilities | US$ in thousands | 1,696,000 | 1,866,000 | 1,470,000 | 1,332,000 | 1,362,000 |
| Cash ratio | 0.54 | 0.51 | 0.62 | 0.71 | 0.82 |
December 31, 2024 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($916,000K
+ $—K)
÷ $1,696,000K
= 0.54
The cash ratio of Weatherford International PLC has shown a declining trend over the past five years. As of December 31, 2020, the cash ratio was 0.82, indicating that the company had $0.82 of cash and cash equivalents for every $1 of current liabilities. This ratio decreased to 0.71 by December 31, 2021, and further declined to 0.62 by December 31, 2022. By the end of December 31, 2023, the cash ratio decreased to 0.51, indicating a potential liquidity strain as the company had insufficient cash to cover its short-term obligations. However, there was a slight improvement by December 31, 2024, as the ratio increased to 0.54.
Overall, the downward trend in the cash ratio raises concerns about Weatherford International PLC's liquidity position and its ability to meet its short-term financial obligations with its available cash reserves. It is essential for the company to closely monitor and manage its cash position to ensure it can effectively navigate potential liquidity challenges in the future.
Peer comparison
Dec 31, 2024