CenterPoint Energy Inc (CNP)

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 90,000 120,000 214,000 114,000 74,000 114,000 555,000 125,000 230,000 133,000 136,000 146,000 147,000 185,000 168,000 220,000 241,000 259,000 271,000 255,000
Short-term investments US$ in thousands 541,000 566,000 517,000 548,000 510,000 452,000 658,000 720,000 1,439,000 911,000 923,000 848,000 871,000 836,000 753,000 678,000 822,000 746,000 687,000 623,000
Receivables US$ in thousands 1,320,000 1,174,000 945,000 1,279,000 1,673,000 1,088,000 1,102,000 1,375,000 1,204,000 957,000 999,000 1,202,000 1,263,000 1,117,000 1,010,000 1,124,000 1,941,000 1,563,000 1,607,000 1,866,000
Total current liabilities US$ in thousands 3,864,000 3,893,000 3,184,000 3,150,000 5,113,000 4,611,000 4,318,000 4,605,000 4,287,000 4,507,000 3,369,000 4,326,000 4,825,000 3,830,000 4,309,000 4,042,000 3,978,000 3,434,000 2,996,000 3,139,000
Quick ratio 0.50 0.48 0.53 0.62 0.44 0.36 0.54 0.48 0.67 0.44 0.61 0.51 0.47 0.56 0.45 0.50 0.76 0.75 0.86 0.87

December 31, 2023 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($90,000K + $541,000K + $1,320,000K) ÷ $3,864,000K
= 0.50

The quick ratio measures a company's ability to meet its short-term obligations with its most liquid assets. A quick ratio above 1 indicates that the company can cover its current liabilities using its quick assets, which include cash, marketable securities, and accounts receivable.

Looking at the quick ratio trend for Centerpoint Energy Inc. over the past eight quarters, we observe fluctuations in the company's ability to cover its short-term liabilities.

In Q4 2023, the quick ratio was 0.58, which indicates that the company had $0.58 in quick assets for every $1 of current liabilities. This represents a slight decrease from the previous quarter's quick ratio of 0.57. The downward trend in the quick ratio may suggest a potential liquidity challenge for Centerpoint Energy Inc. during this period.

Comparing Q4 2023 to the same quarter in the previous year (Q4 2022), where the quick ratio was also 0.75, we see a notable decrease in liquidity. This decline could be attributed to changes in the company's current assets and liabilities mix or operational inefficiencies impacting cash flow management.

It is essential for Centerpoint Energy Inc. to closely monitor and manage its liquidity position to ensure it can meet its short-term obligations and sustain its operations effectively. A deteriorating quick ratio trend may raise concerns among investors and creditors regarding the company's financial health and ability to manage its working capital efficiently. Further analysis of the components contributing to the quick ratio and financial performance as a whole would provide deeper insights into the company's liquidity management.


Peer comparison

Dec 31, 2023