Magnolia Oil & Gas Corp (MGY)
Liquidity ratios
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 1.88 | 2.65 | 3.10 | 2.64 | 2.50 | 2.63 | 2.25 | 2.22 | 2.37 | 1.98 | 1.86 | 2.30 | 2.18 | 1.73 | 1.52 | 1.34 | 1.67 | 1.54 | 1.15 | 1.10 |
| Quick ratio | 1.88 | 2.65 | 3.09 | 2.63 | 2.49 | 2.62 | 2.25 | 2.20 | 2.36 | 1.97 | 1.84 | 2.27 | 2.13 | 1.86 | 1.47 | 1.31 | 1.65 | 1.50 | 1.11 | 1.00 |
| Cash ratio | 1.27 | 2.04 | 2.57 | 2.14 | 1.98 | 2.02 | 1.51 | 1.45 | 1.68 | 1.28 | 1.13 | 1.41 | 1.49 | 1.37 | 0.97 | 0.86 | 1.04 | 0.86 | 0.48 | 0.41 |
Magnolia Oil & Gas Corp's liquidity ratios have shown variability over time. The current ratio, which measures the company's ability to pay its short-term obligations with its short-term assets, has generally been above 1, indicating a healthy liquidity position. The current ratio increased from 1.10 in March 2019 to 3.10 in June 2023, before decreasing slightly to 1.88 by the end of December 2023.
The quick ratio, a more stringent liquidity measure that excludes inventory from current assets, follows a similar trend to the current ratio. Magnolia Oil & Gas Corp's quick ratio ranged from 1.00 in March 2019 to 3.09 in June 2023, showing strong liquidity. Like the current ratio, the quick ratio also decreased slightly to 1.88 by the end of December 2023.
The cash ratio, which assesses the company's ability to cover immediate debt with its most liquid assets, also displays a positive liquidity position for Magnolia Oil & Gas Corp. The cash ratio has improved over time, reaching 2.57 in June 2023, before settling at 1.27 by the end of December 2023.
Overall, Magnolia Oil & Gas Corp's liquidity ratios indicate a generally strong liquidity position, with the company having sufficient current assets to meet its short-term obligations. However, a downward trend in the ratios in the most recent period suggests a potential need for monitoring liquidity management going forward.
Additional liquidity measure
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | -812.70 | -798.71 | -736.30 | -854.07 | -941.65 | -1,013.97 | -919.65 | -535.28 | -468.13 | -353.34 | -269.52 | -232.49 | 43.50 | 24.34 | 17.82 | 15.72 | -286.56 | 53.72 | 51.78 | 102.62 |
The cash conversion cycle of Magnolia Oil & Gas Corp has shown significant fluctuations over the past five years. The company's cash conversion cycle measures how long it takes for the company to convert its investments in inventory and other resources into cash flows from sales.
From December 2019 to March 2020, the company had a negative cash conversion cycle of -286.56 days, indicating efficient management of cash flows and resources. However, this trend reversed in the following quarters, reaching a positive cash conversion cycle in September 2020 and beyond.
The cycle remained positive and continued to increase until December 2022, with the highest peak recorded at -1,013.97 days in September 2022. This prolonged cycle suggests challenges in converting investments into cash, potentially indicating inventory management issues or delayed collections from customers.
In the latest quarter, December 2023, the cash conversion cycle improved to -812.70 days, which indicates a more efficient cash management compared to prior periods. However, the cycle remains negative, implying that the company still benefits from cash inflows before paying its suppliers and creditors.
Overall, Magnolia Oil & Gas Corp's cash conversion cycle has experienced fluctuations over the analyzed period, suggesting variations in the efficiency of managing working capital and cash flows. Further monitoring and analysis of the company's operating and financial activities are recommended to assess its continued performance in this aspect.