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.