Knife River Corporation (KNF)

The liquidity ratios of Knife River Corporation show a positive trend over the years, indicating an improvement in the company's ability to meet its short-term obligations with its current assets.

The current ratio has steadily increased from 1.52 in 2021 to 2.67 in 2024. This indicates that the company has more than enough current assets to cover its current liabilities, providing a buffer for potential cash shortages or unforeseen expenses.

Similarly, the quick ratio and cash ratio have also shown improvement over the years, remaining relatively stable at 0.76 from 2022 to 2024. These ratios measure the company's ability to meet its short-term obligations using its most liquid assets, excluding inventory. The consistent values indicate that Knife River Corporation is able to quickly convert its most liquid assets into cash to meet immediate financial needs.

Overall, the increasing trend in liquidity ratios demonstrates the company's effective management of its current assets and liabilities, indicating a strong financial position and ability to weather short-term financial challenges.

---

Additional liquidity measure

The cash conversion cycle of Knife River Corporation has shown fluctuations over the past five years. In 2020, the company operated with a cash conversion cycle of 0.00 days, indicating an efficient management of cash flows. However, in 2021, the cash conversion cycle increased significantly to 56.52 days, suggesting a potential delay in converting investments and expenses into cash inflows.

Subsequently, in 2022 and 2023, Knife River Corporation was able to reduce its cash conversion cycle to 53.94 days and 50.91 days, respectively. This improvement may indicate better inventory management and quicker collection of receivables during those periods.

Nevertheless, in 2024, the cash conversion cycle extended to 59.60 days, surpassing the previous years' levels. This longer cycle may imply increased time taken to sell inventory, collect payments, or manage payables effectively.

Overall, analyzing the cash conversion cycle of Knife River Corporation indicates fluctuations in the company's efficiency in managing cash flows, inventory, and receivables over the observed period.