NiSource Inc (NI)

NiSource Inc's liquidity ratios have shown an improving trend 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 increased steadily from 0.49 in 2019 to 0.85 in 2023. This indicates that the company's liquidity position has strengthened over time.

The quick ratio, which provides a more stringent measure of liquidity by excluding inventory from current assets, has also shown a positive trend, increasing from 0.38 in 2019 to 0.75 in 2023. This indicates that NiSource Inc has become more capable of meeting its short-term liabilities without relying on inventory.

Furthermore, the cash ratio, which reflects the company's ability to pay off its current liabilities with its cash and cash equivalents, has shown a significant improvement from 0.14 in 2019 to 0.58 in 2023. This suggests that NiSource Inc has enhanced its ability to settle its obligations with readily available cash resources.

Overall, the improving liquidity ratios of NiSource Inc suggest that the company has enhanced its ability to meet its short-term financial obligations and maintain financial stability over the past five years. This trend is generally positive and may indicate a lower risk of liquidity problems in the future.

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Additional liquidity measure

The cash conversion cycle of NiSource Inc has varied significantly over the past five years. In 2023, the company had a cash conversion cycle of 2.92 days, indicating that it took approximately 2.92 days to convert its investments in inventory and accounts receivable into cash. This represents a significant improvement compared to the prior year, where the cycle was 47.47 days, suggesting a more efficient management of working capital.

In 2021, the cash conversion cycle was 16.73 days, demonstrating a moderate increase from 2020, when it was 2.52 days. This suggests a slight delay in converting investments into cash during the year. Looking back to 2019, the company had a cash conversion cycle of 6.06 days, indicating a higher efficiency in working capital management compared to 2021.

Overall, NiSource Inc's cash conversion cycle has shown fluctuations over the years, with 2023 reflecting a strong improvement in efficiency compared to the previous year. It is important for the company to closely monitor and manage its working capital to ensure optimal cash flow and operational efficiency.