Archrock Inc (AROC)
Quick ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 1,338 | 1,566 | 1,569 | 1,097 | 3,685 |
| Short-term investments | US$ in thousands | — | — | — | — | 12 |
| Receivables | US$ in thousands | 124,069 | 137,544 | 104,931 | 104,425 | 144,865 |
| Total current liabilities | US$ in thousands | 152,143 | 148,571 | 125,254 | 111,692 | 138,743 |
| Quick ratio | 0.82 | 0.94 | 0.85 | 0.94 | 1.07 |
December 31, 2023 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($1,338K
+ $—K
+ $124,069K)
÷ $152,143K
= 0.82
The quick ratio of Archrock Inc has shown a declining trend over the past five years, from 1.14 in 2019 to 0.86 in 2023. This indicates that the company may have a decreasing ability to meet its short-term obligations with its most liquid assets.
A quick ratio below 1 suggests that Archrock Inc may have difficulty meeting its short-term liabilities using only its most liquid assets, such as cash, marketable securities, and accounts receivable. It is important for investors and creditors to monitor this trend closely as it may signal potential liquidity challenges for the company.
While the quick ratio is just one aspect of a company's financial health and should be considered alongside other financial metrics, the declining trend in Archrock Inc's quick ratio warrants further investigation into the company's liquidity management and overall financial stability.
Peer comparison
Dec 31, 2023