OGE Energy Corporation (OGE)

OGE Energy Corporation's current ratio has fluctuated over the years, ranging from 0.56 to 0.74. While the current ratio improved in 2022, indicating a better ability to meet short-term obligations, it declined slightly in 2023 and 2024. The current ratio values are below 1, suggesting that the company may have difficulties covering its current liabilities with its current assets.

In terms of quick ratio, OGE Energy Corporation had a significant improvement in 2021, with a ratio of 0.93, indicating a strong ability to meet short-term obligations without relying on inventory. However, the quick ratio dropped in 2022 and remained relatively stable in 2023 and 2024. The quick ratio values below 1 suggest that the company may rely on inventory or may face challenges in meeting short-term obligations without liquidating inventory.

The cash ratio for OGE Energy Corporation was substantial in 2021 at 0.72, indicating a strong ability to cover current liabilities with cash and cash equivalents. However, the cash ratio decreased significantly in 2022 and remained low in 2023 and 2024. The low cash ratio values suggest that the company may have limited cash reserves to cover immediate obligations.

Overall, the liquidity ratios for OGE Energy Corporation show some fluctuations over the years, with current and quick ratios below 1, indicating potential challenges in meeting short-term obligations. The decreasing trend in the cash ratio also suggests a decreasing ability to cover current liabilities with cash and cash equivalents. Management may need to closely monitor liquidity and working capital management to ensure the company can meet its short-term financial obligations.

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Additional liquidity measure

The cash conversion cycle of OGE Energy Corporation has exhibited fluctuations over the years based on the data provided. In 2020 and 2021, the company had negative cash conversion cycles of -0.76 days and -9.22 days respectively, indicating that OGE was able to convert its investments in inventory and accounts receivable into cash quickly during those periods.

However, there was a significant shift in 2022, with the cash conversion cycle further extending to -18.24 days. This suggests that the company's operating efficiency in managing its working capital slightly decreased, leading to a longer time to convert its investments into cash.

The trend reversed in 2023, as the cash conversion cycle turned positive to 13.45 days, indicating a need for OGE to improve its working capital management practices during that period. By 2024, the cash conversion cycle improved to 5.49 days, but it remained higher than the initial years, pointing to ongoing fluctuations in the company's cash conversion efficiency.

Overall, OGE Energy Corporation has experienced varying degrees of effectiveness in converting its investments into cash over the years, highlighting the importance of continuous monitoring and strategic management of working capital for sustainable financial performance.