Xylem Inc (XYL)
Quick ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 1,019,000 | 944,000 | 1,349,000 | 1,875,000 | 724,000 |
| Short-term investments | US$ in thousands | — | — | — | — | 0 |
| Receivables | US$ in thousands | 1,617,000 | 1,096,000 | 953,000 | 923,000 | 1,036,000 |
| Total current liabilities | US$ in thousands | 2,205,000 | 1,590,000 | 1,391,000 | 1,956,000 | 1,501,000 |
| Quick ratio | 1.20 | 1.28 | 1.65 | 1.43 | 1.17 |
December 31, 2023 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($1,019,000K
+ $—K
+ $1,617,000K)
÷ $2,205,000K
= 1.20
The quick ratio of Xylem Inc has shown fluctuating trends over the past five years. As of December 31, 2023, the quick ratio stands at 1.30, indicating that the company has $1.30 of highly liquid assets available to cover each dollar of current liabilities.
Compared to the prior year, the quick ratio has decreased from 1.39 in 2022 to 1.30 in 2023, which may suggest a slight weakening in the company's short-term liquidity position. However, it is important to note that a quick ratio above 1.0 generally indicates that the company has an adequate level of liquid assets to meet its short-term obligations.
Looking back at the historical trend, the quick ratio was highest in 2021 at 1.77, reflecting a strong liquidity position that year. The ratio was lower in 2020 and 2019, at 1.52 and 1.27 respectively, indicating fluctuations in the company's ability to cover its short-term liabilities with its quick assets.
Overall, while the recent decrease in the quick ratio from 2022 to 2023 may raise some concerns about Xylem Inc's short-term liquidity, the company has generally maintained a healthy level of liquidity over the past five years. It is important for stakeholders to continue monitoring this ratio in conjunction with other financial metrics to assess the company's overall financial health.
Peer comparison
Dec 31, 2023