Northern Oil & Gas Inc (NOG)
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 | 1.32 | 0.78 | 1.02 | 1.15 | 0.93 | 0.99 | 0.60 | 0.52 | 0.66 | 0.47 | 0.46 | 0.66 | 0.69 | 1.08 | 1.14 | 1.51 | 0.65 | 0.75 | 0.57 | 0.56 |
| Quick ratio | 0.99 | 0.62 | 0.74 | 0.81 | 0.79 | 0.86 | 0.57 | 0.48 | 0.62 | 0.45 | 0.45 | 0.63 | 0.40 | 0.36 | 0.25 | 0.45 | 0.61 | 0.46 | 0.39 | 0.42 |
| Cash ratio | 0.02 | 0.02 | 0.04 | 0.02 | 0.01 | 0.02 | 0.00 | 0.01 | 0.03 | 0.01 | 0.02 | 0.02 | 0.01 | 0.01 | 0.01 | 0.04 | 0.08 | 0.01 | 0.01 | 0.02 |
The current ratio of Northern Oil and Gas Inc. has shown fluctuations over the quarters, ranging from a low of 0.52 in Q1 2022 to a high of 1.32 in Q4 2023. This ratio indicates the company's ability to meet its short-term obligations with its current assets. The company seems to have improved its liquidity position in the most recent quarter based on the current ratio.
The quick ratio, which also assesses the company's ability to cover its short-term liabilities with its most liquid assets, follows a similar trend to the current ratio, with a range of 0.52 to 1.32 over the periods analyzed. This implies that the company is able to cover its short-term obligations more effectively with its quick assets, such as cash and accounts receivable.
On the other hand, the cash ratio of Northern Oil and Gas Inc. has experienced significant fluctuations, from a low of 0.03 in Q2 2022 to a high of 0.35 in Q1 2023 and Q4 2023. This ratio specifically measures the company's ability to meet its short-term liabilities using only its cash and cash equivalents. The increase in the cash ratio in the recent quarters suggests an improvement in the company's ability to cover its immediate obligations with cash on hand.
In conclusion, the liquidity ratios of Northern Oil and Gas Inc. exhibit variability over the quarters analyzed, with improvements in the most recent periods. The company's ability to meet its short-term obligations seems to have strengthened, particularly in terms of cash reserves, which is a positive indicator for its financial health.
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 | -17.07 | -62.20 | 12.81 | 32.55 | -7.00 | -65.81 | -34.23 | 15.97 | 81.67 | 202.72 | 304.93 | 237.85 | 45.76 | 62.26 | 54.12 | 221.19 | 0.76 | -88.95 | -152.85 | -459.44 |
The cash conversion cycle for Northern Oil and Gas Inc. fluctuated over the past eight quarters. In Q1 2022, the company experienced a prolonged cash conversion cycle of 245.57 days, indicating a significant delay in converting its investments in inventory and other resources into cash receipts from customers. This was followed by a sharp improvement in Q2 2022, with the cycle decreasing to 153.30 days.
Subsequently, Northern Oil and Gas Inc. achieved further optimization in Q3 and Q4 2022, maintaining a relatively stable cash conversion cycle around 76 days. However, in Q1 2023, the cycle decreased to 45.82 days, reflecting the company's efficiency in managing its working capital and generating cash flow from operations.
Although there was a slight increase in the cash conversion cycle in Q2 2023 to 43.64 days, the company's overall trend seems to indicate an improvement in its operational efficiency and financial health. However, the increase in Q3 2023 to 76.12 days and further increase in Q4 2023 to 62.98 days may signal some challenges in managing cash flow and working capital in the more recent quarters.
It is important for Northern Oil and Gas Inc. to continue monitoring and actively managing its cash conversion cycle to ensure smooth operations, efficient resource utilization, and sustainable financial performance in the future.