Expand Energy Corporation (EXE)

Expand Energy Corporation's liquidity ratios have shown significant improvement over the past few years.

The current ratio, which measures the company's ability to meet short-term obligations with its current assets, has been steadily increasing from 0.52 in 2019 to 1.99 in 2023. This indicates that the company has more than enough current assets to cover its current liabilities.

The quick ratio, which provides a more stringent measure of liquidity by excluding inventory from current assets, has also shown a positive trend, increasing from 0.42 in 2019 to 1.76 in 2023. This suggests that the company has a strong ability to meet its short-term obligations using only its most liquid assets.

The cash ratio, which focuses solely on the company's ability to pay off its current liabilities using only cash and cash equivalents, has shown a significant improvement as well. From 0 in 2019, the cash ratio has increased to 1.31 in 2023, indicating that the company now has more cash on hand relative to its current liabilities.

Overall, Expand Energy Corporation's liquidity ratios demonstrate a strengthening financial position, with improved ability to meet its short-term obligations and better management of its liquidity over the years.

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Additional liquidity measure

The cash conversion cycle of Expand Energy Corporation has exhibited fluctuations over the past five years. In 2023, the company's cash conversion cycle improved significantly to -1,023.32 days, indicating that the company's ability to convert its investments in inventory and receivables back into cash has increased.

However, in 2022, the cash conversion cycle deteriorated to -1,297.35 days, reflecting a longer time taken by the company to convert its resources back into cash. This trend continued from 2021 when the cash conversion cycle was also negative at -863.49 days.

The positive cash conversion cycles in recent years suggest that Expand Energy Corporation has been efficient in managing its working capital and generating cash flows from its operations. Conversely, the negative cash conversion cycles in 2019 and 2020 are unusual and may indicate that the company paid off its payables much faster than it collected receivables and managed inventory.

Overall, it is essential for Expand Energy Corporation to closely monitor its cash conversion cycle to ensure optimal working capital management and sustainable cash flows in the future.