Antero Midstream Partners LP (AM)

Antero Midstream Corp's liquidity ratios have varied over the past five years. The current ratio, which measures the company's ability to cover short-term obligations with its current assets, has shown a declining trend from 1.00 in 2020 to 0.95 in 2023. This indicates a potential weakening in the company's short-term liquidity position.

Similarly, the quick ratio, which provides a more stringent measure of liquidity by excluding inventory from current assets, has followed the same downward trend, standing at 0.95 in 2023. This suggests that the company may face challenges in meeting its immediate liabilities with its most liquid assets.

The cash ratio, representing the proportion of current liabilities that could be covered by cash and cash equivalents alone, has remained relatively stable, fluctuating between 0.01 and 0.02 over the five-year period. This indicates that Antero Midstream Corp has limited cash reserves relative to its current liabilities.

Overall, the liquidity ratios of Antero Midstream Corp raise concerns about its ability to efficiently meet its short-term financial obligations. Management may need to closely monitor and improve the company's liquidity position to mitigate potential liquidity risks in the future.

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Additional liquidity measure

The cash conversion cycle of Antero Midstream Corp has shown significant fluctuations over the five-year period.

In 2023, the cash conversion cycle improved to 3.78 days, indicating that the company efficiently turned its resources into cash during the period. This is a positive sign as it suggests better management of working capital.

In contrast, the cycle was negative in 2022 and 2021, at -25.01 days and -35.09 days, respectively. Negative values imply that the company was able to convert its inventory and receivables into cash at a faster rate than paying its suppliers. Although this may seem favorable, it could also indicate potential issues such as aggressive inventory management or delayed payments to suppliers.

In 2020, the cash conversion cycle was 5.02 days, indicating a moderate efficiency in managing cash flows. This could be a result of a balanced approach to working capital management.

Lastly, in 2019, the cash conversion cycle was at 27.12 days, suggesting that the company took longer to convert its resources into cash during that period. This could potentially be due to slower collection of receivables or inventory turnover.

Overall, fluctuations in the cash conversion cycle of Antero Midstream Corp over the years indicate varying levels of efficiency in managing its working capital and cash flow. Monitoring and analyzing trends in the cash conversion cycle can provide insights into the company's liquidity and operational efficiency.