Eversource Energy (ES)

Liquidity ratios

Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 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
Current ratio 0.76 0.86 0.75 0.77 0.67 0.56 0.64 0.65 0.62 0.71 0.77 0.62 0.56 0.72 0.64 0.57 0.64 0.89 0.72 0.75
Quick ratio 0.00 17.42 0.01 0.04 0.01 -0.37 0.39 0.01 0.00 0.09 0.01 0.01 0.01 0.02 0.28 0.21 0.25 0.45 0.02 0.01
Cash ratio 0.00 17.42 0.01 0.04 0.01 -0.37 0.39 0.01 0.00 0.09 0.01 0.01 0.01 0.02 0.28 0.21 0.25 0.45 0.02 0.01

The current ratio of Eversource Energy has shown some fluctuation over the reported periods, ranging from a low of 0.56 to a high of 0.89. This ratio indicates the company's ability to cover its short-term liabilities with its current assets. A ratio below 1 suggests potential liquidity issues, as the company may struggle to meet its short-term debt obligations without relying on external sources.

The quick ratio, also known as the acid-test ratio, provides a more conservative measure of liquidity by excluding inventory from current assets. Eversource Energy's quick ratio has varied significantly, from negative values to as high as 17.42. Negative quick ratios are concerning as they indicate that current liabilities exceed the company's most liquid assets, while extremely high values may suggest an over-reliance on short-term investments for liquidity.

The cash ratio, which is the strictest measure of liquidity, focuses solely on cash and cash equivalents compared to current liabilities. Eversource Energy's cash ratio has mirrored the trends of the quick ratio, with fluctuations including negative values and a spike to 17.42, implying varying levels of liquidity risk over the reporting periods.

In conclusion, Eversource Energy's liquidity ratios demonstrate some degree of volatility, with occasional periods of potential liquidity challenges indicated by ratios below 1 or negative values. This suggests the need for careful monitoring of the company's liquidity position to ensure it can meet its short-term obligations effectively.

Additional liquidity measure

Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 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
Cash conversion cycle days 26.48 27.18 26.23 26.84 22.81 19.25 17.89 19.72 19.86 18.34 16.32 18.92 18.99 15.95 14.24 23.86 21.70 17.77 14.87 24.25

The cash conversion cycle of Eversource Energy has shown some fluctuations over the reported periods. The company's cash conversion cycle, which represents the time it takes for a company to convert its investments in inventory and accounts receivable into cash flows from sales, has ranged from a low of 14.24 days to a high of 27.18 days.

In analyzing the data, we observe that the cash conversion cycle peaked at 27.18 days on September 30, 2024, indicating that the company took a longer time to convert its investments into cash during that period. Conversely, the lowest cash conversion cycle was 14.24 days on June 30, 2021, suggesting that Eversource Energy was efficient in converting its assets into cash at that time.

Overall, the trend in the cash conversion cycle of Eversource Energy suggests that the company has experienced some fluctuations in its ability to efficiently convert its assets into cash over the reported periods. It is important for the company to closely monitor and manage its cash conversion cycle to ensure optimal working capital management and financial stability.