Constellation Energy Corp (CEG)

The liquidity ratios of Constellation Energy Corporation for the past five quarters indicate varying levels of liquidity and ability to meet short-term obligations.

The current ratio, which measures the company's ability to cover its short-term liabilities with its short-term assets, has fluctuated over the quarters, ranging from a low of 1.19 in Q4 2022 to a high of 1.88 in Q3 2023. The current ratio for Q4 2023 is 1.31, indicating that the company may have sufficient current assets to meet its current liabilities, but it has decreased from the previous quarter.

The quick ratio, also known as the acid-test ratio, provides a more stringent measure of liquidity by excluding inventory from current assets. Constellation Energy Corporation's quick ratio has shown a similar trend to the current ratio, with the highest value of 1.59 in Q3 2023 and the lowest value of 0.99 in Q4 2022. The quick ratio for Q4 2023 is 1.06, suggesting a potential decrease in the company's ability to quickly cover its short-term obligations.

The cash ratio, which is the most conservative measure of liquidity as it only considers cash and cash equivalents, has also displayed fluctuations over the quarters. In Q4 2023, the cash ratio is 0.61, compared to a high of 1.16 in Q3 2023 and a low of 0.57 in Q4 2022. This indicates that Constellation Energy Corporation may have less cash and cash equivalents available to meet its immediate payment obligations.

Overall, while the company's liquidity ratios have shown some variability, it is essential for Constellation Energy Corporation to monitor and manage its liquidity position effectively to ensure it can meet its short-term financial commitments.

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Additional liquidity measure

The cash conversion cycle of Constellation Energy Corporation has shown fluctuations over the past five quarters. The company's cash conversion cycle ranged from 26.99 days in Q2 2023 to 49.52 days in Q4 2022. A lower cash conversion cycle indicates that the company is able to convert its investments in inventory and receivables into cash more quickly. Conversely, a higher cash conversion cycle suggests a longer time to convert investments into cash.

It is noteworthy that the company's cash conversion cycle increased in Q4 2023 compared to the previous quarter, indicating a potential delay in converting inventory and receivables into cash. This may be attributed to various factors such as changes in sales terms, inventory management practices, or collection processes.

Overall, monitoring the cash conversion cycle is crucial as it provides insights into the efficiency of a company's working capital management. Constellation Energy Corporation should continue to assess and optimize its operations to ensure a streamlined cash conversion cycle and efficient use of its resources.