CMS Energy Corporation (CMS)

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 0.98 0.90 0.95 1.02 1.15 1.22 1.00 1.36 1.19 0.76 0.75 0.87 0.78 0.83 1.13 0.96 0.86 1.06 0.94 1.13
Quick ratio 0.24 0.17 0.26 0.69 0.81 0.69 0.61 1.10 0.85 0.36 0.41 0.69 0.57 0.49 0.84 0.67 0.63 0.60 0.56 0.87
Cash ratio 0.08 0.06 0.14 0.19 0.05 0.07 0.03 0.25 0.21 0.03 0.05 0.17 0.05 0.17 0.51 0.28 0.05 0.19 0.13 0.11

CMS Energy Corporation's liquidity ratios have shown some fluctuations over the past eight quarters.

The current ratio, which measures the company's ability to pay its short-term obligations with its current assets, has generally been declining since Q4 2022. This suggests that CMS Energy may be experiencing challenges in meeting its short-term liabilities with its current assets.

The quick ratio, also known as the acid-test ratio, provides a more stringent measure of liquidity as it excludes inventory from current assets. Similarly to the current ratio, the quick ratio has generally decreased over the quarters, indicating potential difficulties in meeting immediate obligations without relying on inventory.

The cash ratio, which is the most conservative measure of liquidity as it only includes cash and cash equivalents in current assets, has shown fluctuation but generally trended downwards since Q1 2022. This may imply that CMS Energy has been holding less cash relative to its current liabilities.

Overall, the decreasing trend in all three liquidity ratios suggests that CMS Energy Corporation may be facing liquidity challenges or may need to carefully manage its cash flow to ensure it can meet its short-term obligations efficiently. It would be important for the company to closely monitor its liquidity position and take appropriate measures to address any potential liquidity concerns.

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 349.20 383.00 285.14 76.06 146.84 166.17 44.17 -7.60 -3.34 45.95 13.49 28.32 53.59 42.43 2.16 40.25 75.78 88.19 23.45 47.25

The cash conversion cycle of CMS Energy Corporation has exhibited fluctuations over the past eight quarters. The trend shows that the company's cash conversion cycle has decreased from 82.95 days in Q4 2022 to 62.34 days in Q4 2023. However, there was a slight increase in the cash conversion cycle from Q2 2023 to Q3 2023 before decreasing again in Q4 2023.

It is important to note that a lower cash conversion cycle indicates that the company is able to convert its investments in inventory and accounts receivable into cash more efficiently. The company's cash conversion cycle reached its lowest point in Q1 2022 at 24.25 days, indicating efficient management of working capital during that period.

Overall, the analysis of CMS Energy Corporation's cash conversion cycle suggests that the company has experienced fluctuations in its efficiency in converting its investments into cash over the past eight quarters. The organization should continue to monitor and manage its working capital effectively to maintain a healthy cash conversion cycle.