Analysis of Liquidity Ratios
Liquidity ratios measure the company ability to meet its short-term obligations.
Liquidity Ratios (Summary)
Lockheed Martin Corp., liquidity ratios
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Current ratio | 1.09 | 1.13 | 1.21 | 1.32 | 1.42 | |
| Quick ratio | 0.90 | 0.92 | 0.99 | 1.09 | 1.15 | |
| Cash ratio | 0.18 | 0.13 | 0.09 | 0.16 | 0.26 |
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 readily available assets.
- Current Ratio
- The current ratio decreased steadily from 1.42 in 2021 to 1.09 in 2025. This indicates a shrinking margin of current assets covering current liabilities. While a ratio of 1.09 still suggests the company possesses sufficient current assets to cover current liabilities, the consistent decline warrants monitoring.
- Quick Ratio
- The quick ratio, a more conservative measure excluding inventory, followed a similar downward trajectory, moving from 1.15 in 2021 to 0.90 in 2025. This suggests a weakening ability to cover immediate liabilities with the most liquid assets. The ratio approaching 1.0 indicates a reduced cushion for unexpected short-term obligations.
- Cash Ratio
- The cash ratio experienced the most significant relative decline, falling from 0.26 in 2021 to 0.09 in 2023 before a slight recovery to 0.18 in 2025. This indicates a substantial reduction in the proportion of current assets held as cash, and therefore a diminished capacity to immediately satisfy short-term liabilities without relying on the sale of other current assets. The initial decline and subsequent modest increase suggest potential shifts in cash management strategies or operational needs.
Overall, the observed trends suggest a deliberate or reactive shift in asset allocation, potentially prioritizing investments in longer-term assets or operational expansion. Continued monitoring of these ratios is recommended to assess the sustainability of this trend and its potential impact on the company’s short-term financial health.
Current Ratio
Lockheed Martin Corp., 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 | 25,362) | 21,849) | 20,521) | 20,991) | 19,815) | |
| Current liabilities | 23,335) | 19,420) | 16,937) | 15,887) | 13,997) | |
| Liquidity Ratio | ||||||
| Current ratio1 | 1.09 | 1.13 | 1.21 | 1.32 | 1.42 | |
| 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 | |
| GE Aerospace | 1.04 | 1.09 | 1.18 | 1.16 | 1.28 | |
| Honeywell International Inc. | — | 1.31 | 1.27 | 1.25 | 1.30 | |
| 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
= 25,362 ÷ 23,335 = 1.09
2 Click competitor name to see calculations.
The current ratio exhibited a consistent decline over the five-year period from December 31, 2021, to December 31, 2025. While remaining above one throughout the observed timeframe, the ratio indicates a progressively diminishing ability to cover short-term obligations with short-term assets.
- Current Ratio Trend
- The current ratio decreased from 1.42 in 2021 to 1.09 in 2025. This represents a reduction of approximately 23.2% over the five years. The rate of decline accelerated from 2022 to 2023 (a decrease of 0.11) and again from 2023 to 2024 (a decrease of 0.08), before slowing slightly from 2024 to 2025 (a decrease of 0.04).
- Asset and Liability Contributions
- Both current assets and current liabilities increased in absolute terms during the period. However, current liabilities grew at a faster pace than current assets. Current assets increased from US$19,815 million in 2021 to US$25,362 million in 2025, representing a growth of approximately 27.9%. Current liabilities increased from US$13,997 million in 2021 to US$23,335 million in 2025, representing a growth of approximately 66.7%. This disparity in growth rates is the primary driver of the declining current ratio.
The observed trend suggests a potential increase in reliance on short-term financing or a shift in working capital management. Continued monitoring of this ratio is recommended to assess any potential risks to short-term financial stability.
Quick Ratio
Lockheed Martin Corp., quick ratio calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Cash and cash equivalents | 4,121) | 2,483) | 1,442) | 2,547) | 3,604) | |
| Receivables, net | 3,901) | 2,351) | 2,132) | 2,505) | 1,963) | |
| Contract assets | 13,001) | 12,957) | 13,183) | 12,318) | 10,579) | |
| Total quick assets | 21,023) | 17,791) | 16,757) | 17,370) | 16,146) | |
| Current liabilities | 23,335) | 19,420) | 16,937) | 15,887) | 13,997) | |
| Liquidity Ratio | ||||||
| Quick ratio1 | 0.90 | 0.92 | 0.99 | 1.09 | 1.15 | |
| 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 | |
| GE Aerospace | 0.71 | 0.78 | 0.78 | 0.81 | 0.93 | |
| Honeywell International Inc. | — | 0.88 | 0.84 | 0.88 | 0.94 | |
| 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
= 21,023 ÷ 23,335 = 0.90
2 Click competitor name to see calculations.
The quick ratio exhibited a consistent downward trend over the five-year period. While remaining above one, indicating sufficient short-term liquidity, the ratio decreased from 1.15 in 2021 to 0.90 in 2025. This suggests a diminishing ability to meet immediate obligations with the most liquid assets.
- Quick Ratio Trend
- The quick ratio began at 1.15 in 2021 and experienced a decline to 1.09 in 2022. This downward movement continued, with the ratio reaching 0.99 in 2023 and further decreasing to 0.92 in 2024. The most significant decrease occurred between 2024 and 2025, falling to 0.90.
- Total Quick Assets
- Total quick assets increased from US$16,146 million in 2021 to US$17,370 million in 2022, representing a growth of approximately 7.6%. A slight decrease was observed in 2023, with quick assets totaling US$16,757 million. Subsequent increases were noted in 2024 (US$17,791 million) and 2025 (US$21,023 million), with the largest increase occurring between 2024 and 2025.
- Current Liabilities
- Current liabilities demonstrated a consistent upward trend throughout the period. They rose from US$13,997 million in 2021 to US$15,887 million in 2022, an increase of approximately 13.5%. This growth continued in subsequent years, reaching US$16,937 million in 2023, US$19,420 million in 2024, and US$23,335 million in 2025. The rate of increase in current liabilities appears to have accelerated in the later years of the period.
The observed decline in the quick ratio, despite increases in total quick assets, is primarily attributable to the more substantial growth in current liabilities. This suggests that while the company’s most liquid assets are growing, its short-term obligations are increasing at a faster rate. Continued monitoring of this trend is warranted.
Cash Ratio
Lockheed Martin Corp., cash ratio calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Cash and cash equivalents | 4,121) | 2,483) | 1,442) | 2,547) | 3,604) | |
| Total cash assets | 4,121) | 2,483) | 1,442) | 2,547) | 3,604) | |
| Current liabilities | 23,335) | 19,420) | 16,937) | 15,887) | 13,997) | |
| Liquidity Ratio | ||||||
| Cash ratio1 | 0.18 | 0.13 | 0.09 | 0.16 | 0.26 | |
| 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 | |
| GE Aerospace | 0.32 | 0.42 | 0.45 | 0.44 | 0.54 | |
| Honeywell International Inc. | — | 0.52 | 0.44 | 0.51 | 0.59 | |
| 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
= 4,121 ÷ 23,335 = 0.18
2 Click competitor name to see calculations.
The cash ratio exhibited a declining trend from 2021 to 2023, followed by a recovery in subsequent years. This indicates fluctuations in the company’s ability to meet its short-term obligations with only its most liquid assets.
- Cash Ratio Trend
- The cash ratio decreased from 0.26 in 2021 to a low of 0.09 in 2023. This represents a significant reduction in the proportion of current liabilities covered by total cash assets. A subsequent increase was observed, with the ratio rising to 0.13 in 2024 and further to 0.18 in 2025. While this indicates improvement, the ratio remains below the level recorded in 2021.
- Total Cash Assets
- Total cash assets decreased substantially from US$3,604 million in 2021 to US$1,442 million in 2023. This decline likely contributed to the initial decrease in the cash ratio. Cash assets then increased notably to US$2,483 million in 2024 and continued to rise to US$4,121 million in 2025, exceeding the 2021 level.
- Current Liabilities
- Current liabilities consistently increased throughout the period, rising from US$13,997 million in 2021 to US$23,335 million in 2025. This upward trend in short-term obligations placed increasing pressure on the company’s liquid assets and contributed to the initial decline in the cash ratio. The increasing liabilities, coupled with the initial decrease in cash, created a more challenging liquidity position.
The recovery in the cash ratio in 2024 and 2025 is attributable to the substantial increase in total cash assets, which outpaced the growth in current liabilities during those years. However, the company’s ability to cover its immediate liabilities with cash remains lower than it was in 2021.