This figure includes cash, cash equivalents, accounts receivable, inventories, and other current assets that could be converted into cash within a relatively short period, usually one year. Current assets, as with other balance sheet items, are shown in millions of dollars ($M) and are current as of the last day of the quarter.
Benefit
The more current assets a company has relative to its total assets, the more liquid it is in the short term. Current assets is divided by current liabilities to get the current ratio, a common measure of short-term liquidity.
Origin
This information is found in the assets area of a company’s balance sheet. This information is updated weekly.
For the Pros
Use the following formula as a value method, when you’re looking for cheap stocks. The higher the number, the cheaper the stock:
((Current Assets Quarter 1 – Current Liabilities Quarter 1) / Market Capitalization) x 100