Chord Energy Corp (CHRD)

Chord Energy Corp's liquidity ratios have shown some fluctuations over the past three years.

The current ratio, which measures the company's ability to pay its short-term obligations with its current assets, decreased from 1.32 in 2021 to 1.09 in 2022 before improving to 1.22 in 2023. The current ratio of 1.22 in 2023 indicates an improvement in the company's short-term liquidity position compared to the previous year.

The quick ratio, also known as the acid-test ratio, takes into account only the most liquid assets to cover short-term liabilities. Chord Energy Corp's quick ratio increased from 0.45 in 2021 to 1.05 in 2022 and further improved to 1.16 in 2023. The increasing trend in the quick ratio reflects a better ability to cover immediate liabilities with more liquid assets.

The cash ratio, which is the most conservative liquidity ratio as it only considers cash and cash equivalents, also improved over the three-year period. The cash ratio increased from 0.15 in 2021 to 0.47 in 2022 before declining slightly to 0.35 in 2023. Despite the decrease in 2023, the cash ratio remains at a satisfactory level, indicating that Chord Energy Corp has a reasonable amount of cash to cover its short-term obligations.

Overall, the trend in Chord Energy Corp's liquidity ratios shows a positive trajectory, with improvements in the current ratio, quick ratio, and cash ratio over the past three years. These ratios suggest that the company has been managing its liquidity effectively and has sufficient resources to meet its short-term financial obligations.

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Additional liquidity measure

The cash conversion cycle of Chord Energy Corp has shown fluctuations over the past three years. In Dec 31, 2023, the cash conversion cycle increased to 88.34 days compared to 78.24 days in Dec 31, 2022. This indicates that the company took longer to convert its investments in raw materials into cash from sales during 2023. However, it is worth noting that the cycle was relatively high in Dec 31, 2022 at 78.24 days compared to 87.14 days in Dec 31, 2021, showing an improvement in the efficiency of the company's working capital management during 2022. Overall, the trend in the cash conversion cycle suggests that the company has experienced some challenges in managing its working capital efficiently, particularly in 2023. Further analysis of the underlying factors impacting the cycle may provide insights into areas for improvement in the company's cash flow management.