Analysis of Liquidity Ratios
Liquidity ratios measure the company ability to meet its short-term obligations.
Liquidity Ratios (Summary)
GE Aerospace, liquidity ratios
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Current ratio | 1.04 | 1.09 | 1.18 | 1.16 | 1.28 | |
| Quick ratio | 0.71 | 0.78 | 0.78 | 0.81 | 0.93 | |
| Cash ratio | 0.32 | 0.42 | 0.45 | 0.44 | 0.54 |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
The liquidity position of the company demonstrates a consistent decline across the observed period. All three liquidity ratios – current, quick, and cash – exhibit downward trends from 2021 to 2025, suggesting a decreasing ability to meet short-term obligations using available liquid assets.
- Current Ratio
- The current ratio decreased from 1.28 in 2021 to 1.04 in 2025. While remaining above 1.0 for the entire period, indicating a positive ability to cover current liabilities with current assets, the diminishing value suggests a weakening short-term solvency. The rate of decline appears to be accelerating in the later years of the period.
- Quick Ratio
- The quick ratio, a more conservative measure excluding inventory, also shows a consistent decline, moving from 0.93 in 2021 to 0.71 in 2025. This indicates a decreasing ability to meet short-term obligations with the most liquid assets. The ratio falling below 1.0 in 2022 and continuing to decrease suggests increasing reliance on inventory to cover current liabilities.
- Cash Ratio
- The cash ratio experienced a decrease from 0.54 in 2021 to 0.32 in 2025. This represents the most conservative liquidity measure and demonstrates a significant reduction in the company’s ability to cover immediate liabilities with only cash and cash equivalents. The relatively stable value between 2022 and 2024, followed by a more pronounced decrease in 2025, warrants further investigation.
Collectively, these trends suggest a gradual erosion of the company’s liquidity. While not immediately alarming, the consistent declines in all three ratios indicate a potential need to monitor working capital management and short-term financing strategies closely.
Current Ratio
GE Aerospace, current ratio calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Current assets | 40,596) | 37,635) | 59,799) | 66,234) | 66,348) | |
| Current liabilities | 38,980) | 34,392) | 50,876) | 56,947) | 51,953) | |
| Liquidity Ratio | ||||||
| Current ratio1 | 1.04 | 1.09 | 1.18 | 1.16 | 1.28 | |
| Benchmarks | ||||||
| Current Ratio, Competitors2 | ||||||
| Boeing Co. | 1.19 | 1.32 | 1.14 | 1.22 | 1.33 | |
| Caterpillar Inc. | — | 1.42 | 1.35 | 1.39 | 1.46 | |
| Eaton Corp. plc | — | 1.50 | 1.51 | 1.38 | 1.04 | |
| Honeywell International Inc. | — | 1.31 | 1.27 | 1.25 | 1.30 | |
| Lockheed Martin Corp. | 1.09 | 1.13 | 1.21 | 1.32 | 1.42 | |
| RTX Corp. | — | 0.99 | 1.04 | 1.09 | 1.19 | |
| Current Ratio, Sector | ||||||
| Capital Goods | — | 1.23 | 1.18 | 1.22 | 1.31 | |
| Current Ratio, Industry | ||||||
| Industrials | — | 1.19 | 1.16 | 1.20 | 1.29 | |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Current ratio = Current assets ÷ Current liabilities
= 40,596 ÷ 38,980 = 1.04
2 Click competitor name to see calculations.
The current ratio experienced a generally declining trend over the five-year period. Initial values indicate a relatively stable position, followed by a consistent decrease in the ratio, suggesting a potential shift in the company’s short-term financial flexibility.
- Current Ratio Trend
- The current ratio began at 1.28 in 2021. A decrease to 1.16 was observed in 2022, followed by a slight recovery to 1.18 in 2023. This was then followed by further declines to 1.09 in 2024 and 1.04 in 2025. This indicates a weakening ability to cover short-term liabilities with short-term assets.
Concurrent changes in current assets and current liabilities contribute to the observed trend. While current assets decreased from 66,348 to 59,799 between 2021 and 2023, they experienced a more significant drop to 37,635 by 2024 before a modest increase to 40,596 in 2025. Current liabilities also decreased over the period, from 51,953 in 2021 to 34,392 in 2024, and then increased to 38,980 in 2025. The more substantial decline in current assets relative to current liabilities in the later years appears to be the primary driver of the decreasing current ratio.
- Asset and Liability Dynamics
- The reduction in current assets, particularly the substantial decrease between 2023 and 2024, suggests a potential liquidation of short-term assets or a change in working capital management. The concurrent decrease in current liabilities could be attributed to debt repayment or improved management of short-term obligations, but the overall effect is a diminishing cushion of current assets to cover those liabilities.
The ratio’s movement towards 1.0 indicates a reduced margin of safety. A current ratio below 1.0 would suggest that the company may face challenges in meeting its short-term obligations without relying on additional financing or asset conversions. The observed trend warrants further investigation into the underlying causes of the changes in both current assets and current liabilities.
Quick Ratio
GE Aerospace, quick ratio calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Cash, cash equivalents and restricted cash | 12,392) | 13,619) | 16,967) | 17,262) | 15,770) | |
| Investment securities | —) | 982) | 5,706) | 7,609) | 12,297) | |
| Current receivables | 11,773) | 9,327) | 15,466) | 17,976) | 15,620) | |
| Current contract assets | 3,511) | 2,982) | 1,500) | 3,088) | 4,881) | |
| Total quick assets | 27,676) | 26,910) | 39,639) | 45,935) | 48,568) | |
| Current liabilities | 38,980) | 34,392) | 50,876) | 56,947) | 51,953) | |
| Liquidity Ratio | ||||||
| Quick ratio1 | 0.71 | 0.78 | 0.78 | 0.81 | 0.93 | |
| Benchmarks | ||||||
| Quick Ratio, Competitors2 | ||||||
| Boeing Co. | 0.38 | 0.39 | 0.28 | 0.32 | 0.34 | |
| Caterpillar Inc. | — | 0.80 | 0.74 | 0.79 | 0.89 | |
| Eaton Corp. plc | — | 0.85 | 0.91 | 0.73 | 0.54 | |
| Honeywell International Inc. | — | 0.88 | 0.84 | 0.88 | 0.94 | |
| Lockheed Martin Corp. | 0.90 | 0.92 | 0.99 | 1.09 | 1.15 | |
| RTX Corp. | — | 0.60 | 0.63 | 0.69 | 0.81 | |
| Quick Ratio, Sector | ||||||
| Capital Goods | — | 0.62 | 0.60 | 0.64 | 0.71 | |
| Quick Ratio, Industry | ||||||
| Industrials | — | 0.69 | 0.66 | 0.72 | 0.80 | |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= 27,676 ÷ 38,980 = 0.71
2 Click competitor name to see calculations.
The quick ratio demonstrates a declining trend over the five-year period. Initially at 0.93 in 2021, the ratio decreased to 0.71 by 2025. This indicates a weakening ability to meet short-term obligations with highly liquid assets.
- Overall Trend
- A consistent downward trajectory is evident in the quick ratio from 2021 through 2025. The rate of decline appeared to moderate between 2023 and 2024, but resumed in the final year of the period.
- Quick Asset Evolution
- Total quick assets decreased from US$48,568 million in 2021 to US$39,639 million in 2023, representing a substantial reduction. While a slight increase to US$27,676 million was observed in 2024 and 2025, the level remains significantly below the initial value.
- Current Liability Behavior
- Current liabilities initially increased from US$51,953 million in 2021 to US$56,947 million in 2022. Subsequently, they decreased to US$34,392 million in 2024, before rising again to US$38,980 million in 2025. The decrease in liabilities between 2022 and 2024 did not offset the decline in quick assets, contributing to the falling quick ratio.
- Ratio Dynamics
- The quick ratio’s decline is attributable to a combination of decreasing quick assets and fluctuating current liabilities. The more pronounced decrease in quick assets, particularly between 2021 and 2023, exerted the primary downward pressure on the ratio. The stabilization of the ratio between 2023 and 2024 suggests a temporary balance between asset and liability changes, but the final year’s results indicate a renewed weakening of the short-term liquidity position.
The observed trend warrants further investigation into the composition of quick assets and the reasons for the changes in current liabilities. A sustained decline in the quick ratio could signal increasing liquidity risk.
Cash Ratio
GE Aerospace, cash ratio calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Cash, cash equivalents and restricted cash | 12,392) | 13,619) | 16,967) | 17,262) | 15,770) | |
| Investment securities | —) | 982) | 5,706) | 7,609) | 12,297) | |
| Total cash assets | 12,392) | 14,601) | 22,673) | 24,871) | 28,067) | |
| Current liabilities | 38,980) | 34,392) | 50,876) | 56,947) | 51,953) | |
| Liquidity Ratio | ||||||
| Cash ratio1 | 0.32 | 0.42 | 0.45 | 0.44 | 0.54 | |
| Benchmarks | ||||||
| Cash Ratio, Competitors2 | ||||||
| Boeing Co. | 0.27 | 0.27 | 0.17 | 0.19 | 0.20 | |
| Caterpillar Inc. | — | 0.21 | 0.20 | 0.22 | 0.31 | |
| Eaton Corp. plc | — | 0.26 | 0.34 | 0.09 | 0.08 | |
| Honeywell International Inc. | — | 0.52 | 0.44 | 0.51 | 0.59 | |
| Lockheed Martin Corp. | 0.18 | 0.13 | 0.09 | 0.16 | 0.26 | |
| RTX Corp. | — | 0.11 | 0.14 | 0.16 | 0.22 | |
| Cash Ratio, Sector | ||||||
| Capital Goods | — | 0.26 | 0.24 | 0.26 | 0.32 | |
| Cash Ratio, Industry | ||||||
| Industrials | — | 0.31 | 0.29 | 0.32 | 0.39 | |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= 12,392 ÷ 38,980 = 0.32
2 Click competitor name to see calculations.
The cash ratio exhibited a generally declining trend over the five-year period. While fluctuations occurred, the company’s ability to meet its current liabilities solely with cash assets decreased consistently.
- Cash Ratio Trend
- The cash ratio began at 0.54 in 2021, indicating the company held 54 cents of cash for every dollar of current liabilities. This ratio decreased to 0.44 in 2022, representing a notable decline. A slight recovery to 0.45 was observed in 2023, but this was followed by a further decrease to 0.42 in 2024. The most significant drop occurred between 2024 and 2025, with the ratio falling to 0.32. This final value suggests the company possesses only 32 cents of cash for each dollar of current liabilities.
- Total Cash Assets
- Total cash assets decreased steadily throughout the period. Beginning at US$28,067 million in 2021, cash holdings declined to US$24,871 million in 2022, and continued to fall to US$22,673 million in 2023. The rate of decline accelerated in 2024, with cash assets dropping to US$14,601 million, and further decreasing to US$12,392 million by the end of 2025. This consistent reduction in cash assets contributed to the observed decline in the cash ratio.
- Current Liabilities
- Current liabilities initially increased from US$51,953 million in 2021 to US$56,947 million in 2022. A decrease to US$50,876 million was noted in 2023. A substantial reduction in current liabilities occurred in 2024, falling to US$34,392 million. However, current liabilities increased again in 2025, reaching US$38,980 million. The interplay between decreasing cash assets and fluctuating current liabilities significantly impacted the cash ratio.
The combined effect of decreasing cash assets and the fluctuations in current liabilities resulted in a consistent weakening of the company’s cash ratio. The most pronounced decline occurred in the final year of the observed period.