Alliant Energy Corp (LNT)

Alliant Energy Corp.'s liquidity ratios have shown some fluctuations over the past five years. The current ratio, which measures the company's ability to cover its short-term obligations with its current assets, has decreased from 0.43 in 2019 to 0.55 in 2023. This indicates a slight improvement in the company's short-term liquidity position over the past year.

The quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, also saw a similar trend, declining from 0.32 in 2019 to 0.40 in 2023. While the quick ratio has improved compared to 2019, it still remains relatively low, suggesting that Alliant Energy Corp. may have difficulty meeting its short-term obligations without relying on inventory.

Lastly, the cash ratio, which assesses the company's ability to cover its current liabilities with available cash and cash equivalents, has fluctuated over the years, reaching 0.20 in 2023. This indicates that Alliant Energy Corp. has a moderate ability to cover its short-term obligations with cash on hand.

Overall, Alliant Energy Corp.'s liquidity ratios suggest that the company has made modest improvements in its short-term liquidity position over the past year. However, the current and quick ratios remain relatively low, indicating the need for the company to carefully manage its working capital to ensure it can meet its short-term financial obligations effectively.

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Additional liquidity measure

The cash conversion cycle measures how long it takes for a company to convert its investments in raw materials into cash inflows from the sale of finished goods. A negative cash conversion cycle typically indicates efficient working capital management, as it means the company is able to collect cash from customers before paying its suppliers.

For Alliant Energy Corp., the cash conversion cycle has fluctuated over the past five years:
- In 2023, the cash conversion cycle was -17.40 days, indicating the company improved its ability to collect cash from customers and manage its working capital effectively.
- In 2022, the cycle was -43.00 days, which was significantly lower than in 2023. This may suggest a more aggressive accounts payable policy or a delay in collecting receivables.
- In 2021, the cycle was -4.49 days, showing improvement compared to 2022.
- In 2020, the cycle was -1.50 days, indicating a further improvement in working capital management.
- In 2019, the cycle was -7.86 days, showing relative efficiency in managing the cash conversion cycle.

Overall, Alliant Energy Corp. has shown a trend of improving its cash conversion cycle over the past five years, reflecting efficient working capital management practices. However, the significant fluctuation in the cycle warrants further investigation into the company's accounts receivable, inventory, and accounts payable processes to ensure sustainable efficiency.