MasTec Inc (MTZ)
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 | 1.01 | 1.24 | 1.27 | 1.31 | 1.40 | 1.44 | 1.57 | 1.54 | 1.55 | 1.57 | 1.61 | 1.49 | 1.61 | 1.52 | 1.47 | 1.56 | 1.67 | 1.54 | 1.40 | 1.65 |
| Quick ratio | 0.13 | 0.06 | 0.11 | 0.09 | 0.19 | 0.08 | 0.05 | 0.06 | 0.15 | 0.05 | 0.07 | 0.13 | 0.21 | 0.14 | 0.14 | 0.31 | 0.31 | 0.16 | 0.03 | 0.06 |
| Cash ratio | 0.13 | 0.06 | 0.11 | 0.09 | 0.19 | 0.08 | 0.05 | 0.06 | 0.15 | 0.05 | 0.07 | 0.13 | 0.21 | 0.14 | 0.14 | 0.31 | 0.31 | 0.16 | 0.03 | 0.06 |
MasTec Inc's current ratio has shown some fluctuations over the past few years but generally remained above 1, indicating the company has had sufficient current assets to cover its current liabilities. The ratio peaked at 1.67 on December 31, 2020, and has mostly stayed above 1.4 since then.
On the other hand, the quick ratio, which excludes inventory from current assets, has been relatively low for MasTec Inc. This suggests that the company may have limited ability to meet its short-term obligations without relying on selling inventory. The quick ratio ranged from 0.03 to 0.31 over the period analyzed, with the highest point recorded on December 31, 2020.
Lastly, the cash ratio, which measures the company's ability to meet its short-term liabilities with its most liquid assets, has also been low for MasTec Inc. The company had minimal cash on hand relative to its current liabilities, with the ratio fluctuating between 0.03 and 0.31 during the period examined, reaching its peak on December 31, 2020.
In conclusion, while MasTec Inc's current ratio indicates a generally healthy liquidity position, the low quick and cash ratios suggest the company may face challenges in meeting its short-term obligations without relying on inventory or other liquid assets.
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 | 3.58 | 3.34 | 3.54 | 3.75 | 3.67 | 4.56 | 5.77 | 6.53 | 5.01 | 6.20 | 6.12 | 5.27 | 4.97 | 5.10 | 5.41 | 6.09 | 6.21 | 5.80 | 6.73 | 6.50 |
MasTec Inc's cash conversion cycle, a measure of how long it takes for the company to convert its investments in inventory and other resources into cash flows from sales, has seen fluctuations over the past few years. The cash conversion cycle decreased from 6.50 days on March 31, 2020, to 3.58 days on December 31, 2024, indicating an improvement in the company's efficiency in managing its working capital.
A decreasing trend in the cash conversion cycle is generally positive as it signifies that MasTec Inc is able to collect cash from its sales more quickly or is managing its inventory and payables more effectively. The company was able to reduce the time it takes to convert its resources into cash over the years, which can potentially lead to improved liquidity and financial performance.
However, it is essential for MasTec Inc to closely monitor its cash conversion cycle to ensure that the trend continues positively. Maintaining an efficient cash conversion cycle is crucial for the company's liquidity and overall financial health. Any sudden increase in the cash conversion cycle could indicate potential issues in inventory management, sales collections, or payables that may need to be addressed promptly to sustain financial stability.