Exxon Mobil Corp (XOM)
Liquidity ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Current ratio | 1.48 | 1.41 | 1.04 | 0.80 | 0.78 |
| Quick ratio | 1.06 | 0.82 | 0.69 | 1.21 | 0.47 |
| Cash ratio | 0.48 | 0.21 | 0.12 | 0.85 | 0.05 |
Exxon Mobil Corp.'s liquidity ratios indicate its ability to meet short-term obligations efficiently. The current ratio has improved steadily in recent years, reaching 1.48 in 2023 from 0.78 in 2019, reflecting an increase in current assets relative to current liabilities. This suggests the company has a comfortable buffer to cover its short-term liabilities.
The quick ratio, which provides a more stringent measure of liquidity by excluding inventory from current assets, has also shown improvement. The ratio increased from 0.49 in 2019 to 1.09 in 2023, indicating Exxon Mobil Corp. has a solid ability to pay its short-term obligations without relying on selling inventory.
The cash ratio, which focuses solely on the most liquid assets, shows a significant improvement over the years. Exxon Mobil Corp. has increased its cash reserves relative to current liabilities, with the ratio climbing from 0.07 in 2019 to 0.51 in 2023. This indicates a strengthening ability to settle debts using cash on hand.
Overall, Exxon Mobil Corp.'s liquidity position has enhanced over the years, with increasing current, quick, and cash ratios. This trend suggests the company has adequate liquidity to manage its short-term financial commitments efficiently, which is crucial for its financial health and operational stability.
See also:
Exxon Mobil Corp Liquidity Ratios
Additional liquidity measure
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash conversion cycle | days | -388.14 | -614.69 | -534.80 | -140.49 | -322.26 |
The cash conversion cycle of Exxon Mobil Corp. has fluctuated over the past five years. In 2023, the company's cash conversion cycle increased to 41.03 days from 37.89 days in 2022, indicating that it took slightly longer for the company to convert its investments in inventory and receivables into cash during the most recent year. This increase follows a decrease in the cash conversion cycle from 2021 to 2022.
Comparing the data to 2020 and 2019, the cash conversion cycles were 41.79 days and 37.93 days, respectively. This suggests that the company's efficiency in managing its working capital improved from 2020 to 2019 but deteriorated in 2023 compared to the prior years. Overall, Exxon Mobil Corp. should continue to monitor its cash conversion cycle to ensure optimal management of its working capital and liquidity.