American Water Works (AWK)
Quick ratio
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash | US$ in thousands | 330,000 | 628,000 | 794,000 | 213,000 | 85,000 | 77,000 | 71,000 | 75,000 | 116,000 | 70,000 | 70,000 | 69,000 | 547,000 | 560,000 | 569,000 | 556,000 | 60,000 | 94,000 | 64,000 | 63,000 |
| Short-term investments | US$ in thousands | 62,000 | 72,000 | 69,000 | 64,000 | 67,000 | 23,000 | 25,000 | — | — | — | — | 2,223,000 | 2,113,000 | 2,060,000 | — | — | 8,000 | 13,000 | 4,000 | 5,000 |
| Receivables | US$ in thousands | 727,000 | 754,000 | 757,000 | 703,000 | 723,000 | 631,000 | 667,000 | 520,000 | 519,000 | 597,000 | 565,000 | 493,000 | 527,000 | 559,000 | 505,000 | 464,000 | 466,000 | 522,000 | 516,000 | 477,000 |
| Total current liabilities | US$ in thousands | 2,151,000 | 1,743,000 | 1,764,000 | 1,892,000 | 2,811,000 | 2,130,000 | 1,728,000 | 1,648,000 | 2,141,000 | 1,844,000 | 1,710,000 | 2,451,000 | 2,881,000 | 2,260,000 | 2,113,000 | 2,767,000 | 2,045,000 | 1,488,000 | 1,317,000 | 2,156,000 |
| Quick ratio | 0.52 | 0.83 | 0.92 | 0.52 | 0.31 | 0.34 | 0.44 | 0.36 | 0.30 | 0.36 | 0.37 | 1.14 | 1.11 | 1.41 | 0.51 | 0.37 | 0.26 | 0.42 | 0.44 | 0.25 |
December 31, 2023 calculation
Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($330,000K
+ $62,000K
+ $727,000K)
÷ $2,151,000K
= 0.52
The quick ratio of American Water Works Co. Inc. has shown variability over the past eight quarters, ranging from a low of 0.40 in Q4 2022 to a high of 1.05 in Q2 2023. The quick ratio measures the company's ability to meet its short-term obligations with its most liquid assets, excluding inventory.
A quick ratio below 1 indicates that the company may have difficulty meeting its short-term obligations without relying on selling inventory. During Q4 2022, the quick ratio was particularly low at 0.40, suggesting potential liquidity challenges for the company during that period.
On the other hand, in Q2 2023, the quick ratio improved significantly to 1.05, indicating a stronger ability to cover short-term liabilities with liquid assets. This may imply improved liquidity and financial health for American Water Works Co. Inc. during that quarter.
Overall, it is essential for the company to maintain a healthy quick ratio above 1 to ensure it can meet its short-term obligations comfortably without over-reliance on selling inventory. Monitoring the trend of the quick ratio over time can provide insights into the company's liquidity management and financial stability.
Peer comparison
Dec 31, 2023