CF Industries Holdings Inc (CF)
Liquidity ratios
| 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 3.81 | 4.52 | 6.55 | 4.46 | 3.69 | 2.66 | 3.41 | 1.72 | 1.81 | 1.79 | 2.44 | 1.67 | 1.51 | 1.72 | 1.85 | 1.20 | 1.46 | 1.34 | 1.43 | 1.71 |
| Quick ratio | 3.17 | 4.37 | 6.19 | 4.18 | 3.19 | 2.27 | 3.02 | 1.52 | 1.52 | 1.22 | 1.96 | 1.31 | 1.13 | 1.28 | 1.32 | 0.81 | 0.80 | 1.07 | 1.12 | 1.13 |
| Cash ratio | 2.54 | 3.92 | 5.57 | 3.62 | 2.60 | 1.75 | 2.36 | 1.21 | 1.18 | 0.84 | 1.34 | 1.00 | 0.84 | 0.94 | 0.92 | 0.61 | 0.43 | 0.82 | 0.82 | 0.81 |
Based on the data provided, CF Industries Holdings Inc has displayed a consistent improvement in its liquidity ratios over the quarters.
The current ratio, which measures the company's ability to cover its short-term obligations with its current assets, has been increasing steadily from Q1 2022 to Q4 2023. The ratio has ranged from 1.72 to 6.55, with the latest ratio in Q4 2023 at 3.81, indicating a healthy liquidity position.
The quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, has also shown a positive trend, with values ranging from 1.50 to 6.03. The latest quick ratio in Q4 2023 is 3.44, indicating the company's ability to meet its short-term obligations without relying on inventory.
Furthermore, the cash ratio, which reflects the company's ability to cover its current liabilities with its cash and cash equivalents, has also improved consistently over the quarters. The cash ratio has varied between 1.19 and 5.41, with the most recent value in Q4 2023 at 2.81, suggesting CF Industries Holdings Inc has ample cash resources to meet its immediate obligations.
Overall, the liquidity ratios of CF Industries Holdings Inc demonstrate a strong and improving financial position, indicating the company's ability to meet its short-term obligations and manage liquidity effectively.
Additional liquidity measure
| 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 conversion cycle | days | 44.32 | 46.42 | 40.12 | 46.62 | 47.16 | 57.73 | 63.22 | 68.70 | 53.95 | 68.99 | 61.91 | 65.28 | 45.64 | 54.73 | 51.89 | 60.75 | 48.41 | 55.30 | 54.33 | 67.71 |
CF Industries Holdings Inc has shown fluctuations in its cash conversion cycle over the past eight quarters. The trend indicates that the company's efficiency in converting its investments in inventory and accounts receivable into cash is improving overall, as the cycle has generally decreased over time.
In Q1 2022, the cash conversion cycle was at its highest level of 68.70 days, indicating that the company took longer to convert its investments into cash during that period. However, there has been a steady improvement since then, with the cycle steadily decreasing to 44.32 days in Q4 2023.
This improvement suggests that CF Industries Holdings Inc has been managing its inventory and accounts receivable more effectively, leading to quicker cash generation. A shorter cash conversion cycle is generally a positive indicator, as it implies that the company is able to generate cash more quickly from its operating activities.
Overall, the decreasing trend in the cash conversion cycle for CF Industries Holdings Inc is a favorable sign of improved operational efficiency and effective working capital management.