NRG Energy Inc. (NRG)
Current ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total current assets | US$ in thousands | 9,727,000 | 16,231,000 | 10,841,000 | 6,028,000 | 3,088,000 |
| Total current liabilities | US$ in thousands | 9,500,000 | 12,982,000 | 7,915,000 | 1,915,000 | 2,359,000 |
| Current ratio | 1.02 | 1.25 | 1.37 | 3.15 | 1.31 |
December 31, 2023 calculation
Current ratio = Total current assets ÷ Total current liabilities
= $9,727,000K ÷ $9,500,000K
= 1.02
The current ratio of NRG Energy Inc. has shown a declining trend over the past five years. In 2019, the current ratio was relatively healthy at 1.31, indicating that the company had $1.31 in current assets to cover each $1 of current liabilities. However, there was a significant drop in the ratio to 3.15 in 2020, which might be attributed to a temporary increase in current assets or a reduction in current liabilities.
Subsequently, the ratio decreased further to 1.37 in 2021, 1.25 in 2022, and 1.02 in 2023. These decreasing values suggest a potential deterioration in the company's liquidity position, as it indicates a diminishing ability to cover its short-term obligations with current assets.
It is important to note that while a current ratio above 1.0 generally indicates a company has sufficient current assets to cover its current liabilities, the downward trend in the current ratio of NRG Energy Inc. raises concerns about its short-term financial health and ability to meet its obligations. Additional analysis of the composition of current assets and liabilities would provide further insights into the underlying factors contributing to the declining current ratio.
Peer comparison
Dec 31, 2023