MasTec Inc (MTZ)
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 | 1.40 | 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 | 1.78 | 1.65 | 1.53 | 1.79 |
| Quick ratio | 0.67 | 0.63 | 0.66 | 0.64 | 0.71 | 0.58 | 0.61 | 0.61 | 0.77 | 0.70 | 0.67 | 0.85 | 0.85 | 0.76 | 0.64 | 0.69 | 0.76 | 1.50 | 1.37 | 1.61 |
| Cash ratio | 0.19 | 0.08 | 0.05 | 0.06 | 0.15 | 0.05 | 0.07 | 0.12 | 0.20 | 0.14 | 0.14 | 0.31 | 0.30 | 0.16 | 0.03 | 0.06 | 0.06 | 0.03 | 0.04 | 0.03 |
MasTec Inc's liquidity ratios indicate the company's ability to meet its short-term obligations. The current ratio has been relatively stable, ranging from 1.40 to 1.61 over the past five quarters, with the latest ratio standing at 1.40 as of December 31, 2023. This suggests that MasTec has a comfortable level of current assets to cover its current liabilities.
On the other hand, the quick ratio, which provides a more stringent measure of liquidity by excluding inventory from current assets, has shown some fluctuation, ranging from 0.58 to 0.85 over the same period. The latest quick ratio of 0.67 as of December 31, 2023, indicates that MasTec may have some difficulty meeting its short-term obligations without relying on inventory sales.
The cash ratio, measuring the company's ability to cover its current liabilities with its most liquid assets, has also fluctuated, ranging from 0.03 to 0.31 over the past five quarters. The cash ratio stood at 0.19 as of December 31, 2023, suggesting MasTec has an improved ability to cover its short-term obligations with its cash reserves.
Overall, MasTec Inc's liquidity position appears stable, with the current ratio indicating a healthy level of current assets to meet current liabilities. However, the company may need to manage its quick ratio more effectively to ensure it can meet short-term obligations without relying heavily on inventory. The increasing trend in the cash ratio is a positive sign, but ongoing monitoring is advised to ensure liquidity remains strong.
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 | 7.48 | 14.57 | 23.73 | 21.78 | 15.50 | 10.66 | 14.39 | 12.98 | 19.57 | 14.66 | 14.04 | 15.60 | 14.90 | 21.56 | 19.14 | 7.81 | -3.87 | 1.20 | -554.36 | -459.32 |
The cash conversion cycle for MasTec Inc has fluctuated over the past few quarters, indicating changes in the efficiency of the company's cash management and working capital management.
In the latest quarter, the cash conversion cycle was 7.48 days, reflecting the time it takes for MasTec Inc to convert its investments in inventory and accounts receivable into cash. This suggests that the company is efficiently managing its working capital and able to convert its assets into cash relatively quickly.
However, the cash conversion cycle increased in the preceding quarters, reaching a peak of 23.73 days in the second quarter of 2023. This indicates a longer period of time for MasTec Inc to convert its resources into cash, which could potentially impact the company's liquidity and financial performance.
In the first quarter of 2020, MasTec Inc reported a negative cash conversion cycle, implying that the company was able to collect cash from customers before paying its suppliers. This is an optimal situation as it signifies efficient working capital management and potentially improved profitability.
Overall, MasTec Inc should closely monitor its cash conversion cycle to ensure efficient management of its working capital and to maintain healthy liquidity levels in order to support its ongoing operations and growth initiatives.