Antero Resources Corp (AR)

Antero Resources Corp's liquidity ratios show a concerning trend over the years. The current ratio, which measures the company's ability to cover its short-term liabilities with its current assets, has declined from 0.58 in 2020 to 0.35 in 2024. This indicates a potential liquidity challenge as the current assets are decreasing relative to current liabilities.

The quick ratio, a more stringent measure of liquidity excluding inventory from current assets, also demonstrates a deteriorating performance over the period. The quick ratio has improved slightly from negative values in 2020 and 2021 to 0.02 in 2024, but it still remains relatively low.

Similarly, the cash ratio, which assesses the company's ability to cover its current liabilities with its cash and cash equivalents, has shown some improvement from negative figures to 0.00 in 2023 and 2024. However, having a cash ratio of 0.00 suggests that the company may struggle to meet its short-term obligations using only its cash reserves.

Overall, based on these liquidity ratios, Antero Resources Corp appears to be facing challenges in maintaining adequate liquidity levels to support its short-term financial obligations. Management should closely monitor and address these liquidity concerns to ensure the company's financial stability and sustainability.

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Additional liquidity measure

The cash conversion cycle of Antero Resources Corp has fluctuated significantly over the years, indicating potential changes in the company's working capital management efficiency.

As of December 31, 2020, the cash conversion cycle stood at 1,014 days, reflecting the time it takes for the company to convert its investments in inventory and other resources into cash inflows from sales.

By December 31, 2021, the cash conversion cycle increased significantly to 5,185.65 days, suggesting a substantial delay in the company's ability to convert its resources into cash. This prolonged cycle may indicate inefficiencies in managing inventory, accounts receivable, and accounts payable.

However, there was a notable improvement by December 31, 2022, with the cash conversion cycle decreasing to 3,761.31 days. Although still high, this reduction may indicate efforts to streamline operations and enhance working capital management.

By December 31, 2023, the cash conversion cycle plummeted to 3.32 days, which is a drastic improvement compared to previous years. This sharp decline suggests that the company has significantly optimized its processes for converting resources into cash efficiently.

As of December 31, 2024, the cash conversion cycle further decreased to 2.90 days, indicating continued progress in the company's working capital management. This low figure implies that Antero Resources Corp has become more effective in converting its investments into cash quickly.

Overall, the trend in Antero Resources Corp's cash conversion cycle shows fluctuations over the years, but recent improvements suggest enhanced efficiency in managing working capital and the conversion of resources into cash.