What is Coca Cola's liquidity ratio? (2024)

What is Coca Cola's liquidity ratio?

Current and historical current ratio for CocaCola (KO) from 2010 to 2023. Current ratio can be defined as a liquidity ratio that measures a company's ability to pay short-term obligations. CocaCola current ratio for the three months ending December 31, 2023 was 1.13.

What is a good liquidity ratio?

In short, a “good” liquidity ratio is anything higher than 1. Having said that, a liquidity ratio of 1 is unlikely to prove that your business is worthy of investment. Generally speaking, creditors and investors will look for an accounting liquidity ratio of around 2 or 3.

What is the current ratio liquidity ratio?

The current ratio is a liquidity ratio that measures a company's ability to pay short-term obligations or those due within one year. It tells investors and analysts how a company can maximize the current assets on its balance sheet to satisfy its current debt and other payables.

Is 1.6 A good liquidity ratio?

A good current ratio is between 1.2 to 2, which means that the business has 2 times more current assets than liabilities to covers its debts. A current ratio below 1 means that the company doesn't have enough liquid assets to cover its short-term liabilities.

What is the current liquidity ratio for PepsiCo?

PepsiCo's current ratio hit its 5-year low in December 2022 of 0.8x. PepsiCo's current ratio decreased in 2019 (0.9x, -12.8%), 2021 (0.8x, -15.6%), and 2022 (0.8x, -3.2%) and increased in 2020 (1.0x, +14.1%) and 2023 (0.9x, +5.9%).

What liquidity ratio is too high?

Creditors and investors like to see higher liquidity ratios, such as 2 or 3. The higher the ratio is, the more likely a company is able to pay its short-term bills. A ratio of less than 1 means the company faces a negative working capital and can be experiencing a liquidity crisis.

Is 0.8 a good liquidity ratio?

Generally, a Quick Ratio of 1.0 or greater is considered adequate to ensure a company's ability to pay its current obligations.

What is the most common liquidity ratio?

The most common liquidity ratios are the current ratio and quick ratio. These are very useful ratios for calculating a company's ability to pay short term liabilities.

What does a liquidity ratio of 1.5 mean?

For instance, a quick ratio of 1.5 indicates that a company has $1.50 of liquid assets available to cover each $1 of its current liabilities. While such numbers-based ratios offer insight into the viability and certain aspects of a business, they may not provide a complete picture of the overall health of the business.

How to interpret liquidity ratio?

The result from any of these equations can be interpreted the same way but should be analyzed based on the company and its industry. A liquidity ratio of less than 1 means that the company would not be able to fully cover its current liabilities with the assets used in the numerator of the equation.

What is a bad liquidity ratio?

Low current ratio: A ratio lower than 1.0 can result in a business having trouble paying short-term obligations. As such, it may make the business look like a bigger risk for lenders and investors.

What is an unhealthy liquidity ratio?

A bad Liquidity Ratio is one that is below 1.0, indicating that the company does not have enough current assets to cover its short-term liabilities.

What does a liquidity ratio of 2.5 mean?

The current ratio for Company ABC is 2.5, which means that it has 2.5 times its liabilities in assets and can currently meet its financial obligations Any current ratio over 2 is considered 'good' by most accounts.

What is Wendy's liquidity ratio?

Wendy's's operated at median current ratio of 1.7x from fiscal years ending December 2019 to 2023. Looking back at the last 5 years, Wendy's's current ratio peaked in January 2023 at 2.7x. Wendy's's current ratio hit its 5-year low in January 2022 of 1.4x.

What is the quick ratio of Coca Cola?

The quick ratio measures a company's ability to meet its short-term obligations with its most liquid assets. It is calculated as a company's Total Current Assets excludes Total Inventories divides by its Total Current Liabilities. Coca-Cola Co's quick ratio for the quarter that ended in Dec. 2023 was 0.95.

What is the quick ratio of Pepsi?

PepsiCo has a quick ratio of 0.68. It indicates that the company cannot currently fully pay back its current liabilities. During the past 13 years, PepsiCo's highest Quick Ratio was 1.37. The lowest was 0.61.

What is Apple's current ratio?

Current ratio can be defined as a liquidity ratio that measures a company's ability to pay short-term obligations. Apple current ratio for the three months ending December 31, 2023 was 1.07.

What is the best liquidity ratio for banks?

2) On Hand Liquidity Ratio: This point-in-time ratio, often called the Primary Liquidity Ratio, assesses a bank's ability to satisfy liabilities with on-balance sheet high-quality liquid assets (HQLA). A minimum of 25% is recommended, with less than 15% warranting a Contingency Funding Plan action.

Can a firm have too much liquidity?

It can also be a hurdle for business expansion. Excess liquidity suggests to investors, shareholders, and analysts that the firm is unable to effectively utilise the available cash resources or identify investment opportunities that can generate revenues.

How to compare liquidity of two companies?

The three main liquidity ratios are the current, quick, and cash ratios. The current ratio is current assets divided by current liabilities. The quick ratio is current assets minus inventory divided by current liabilities. The cash ratio is cash plus marketable securities divided by current liabilities.

Do you want a high liquidity ratio?

Another advantage of liquidity ratios is their utility in assessing a company's financial health and risk level. A high liquidity ratio suggests that a company possesses sufficient liquid assets to handle its short-term obligations comfortably. A low liquidity ratio may signal potential liquidity issues.

What is the average liquidity ratio for banks?

Liquidity ratio from 1994 to 2018 vs 2019 in the U.S.

During the period of time from 1994 to 2018, the average liquidity ratio of banks in the United States was 7.3 percent. In 2019, the liquidity ratio rose to 15.3 percent.

What are the 5 liquidity ratios?

What is the downside of holding too much cash?

Lower returns: Since cash is largely a risk-free asset, investors don't get the “risk premium” that other investments, like mutual funds or GICs, may come with. Inflation risk: While cash has no capital risk, inflation can erode its purchasing power – meaning you wouldn't be able to buy as much with it in the future.

How do you get quick assets?

Quick assets = (cash + cash equivalents + short-term investments + accounts receivable ) / (current liabilities)