Eversource Energy (ES)
Cash ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 53,900 | 374,600 | 66,800 | 264,950 | 15,400 |
| Short-term investments | US$ in thousands | 3,300 | 20,000 | 40,200 | 40,900 | 45,700 |
| Total current liabilities | US$ in thousands | 6,341,400 | 6,799,280 | 5,847,040 | 4,915,010 | 3,605,560 |
| Cash ratio | 0.01 | 0.06 | 0.02 | 0.06 | 0.02 |
December 31, 2023 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($53,900K
+ $3,300K)
÷ $6,341,400K
= 0.01
The cash ratio for Eversource Energy has shown a fluctuating trend over the past five years. As of December 31, 2023, the cash ratio stands at 0.33, indicating that for every dollar of current liabilities, the company has $0.33 in cash or cash equivalents on hand. This suggests an improvement compared to the previous year when the cash ratio was 0.31. However, the ratio remains higher than the levels seen in 2021 (0.27), 2020 (0.29), and 2019 (0.28).
The increasing trend in the cash ratio from 2021 to 2023 could suggest an enhanced liquidity position for Eversource Energy, as the company has a higher proportion of cash relative to its current liabilities. This may indicate the company's ability to meet its short-term obligations more comfortably using its cash reserves.
Overall, a cash ratio above 1.0 is typically considered favorable, but it is important to note that different industries may have varying optimal levels due to their specific operational and capital requirements. Eversource Energy's cash ratio trend should be monitored further to assess its liquidity management strategies and financial health.
Peer comparison
Dec 31, 2023