Ovintiv Inc (OVV)

Quick ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cash	US$ in thousands	3,000	5,000	195,000	10,000	190,000
Short-term investments	US$ in thousands	—	70,000	67,000	38,000	41,000
Receivables	US$ in thousands	2,420,000	2,790,000	2,371,000	1,957,000	2,540,000
Total current liabilities	US$ in thousands	2,812,000	2,780,000	2,748,000	2,423,000	2,432,000
Quick ratio		0.86	1.03	0.96	0.83	1.14

December 31, 2023 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($3,000K + $—K + $2,420,000K) ÷ $2,812,000K
= 0.86

The quick ratio, also known as the acid-test ratio, measures a company's ability to cover its short-term liabilities with its most liquid assets. A quick ratio below 1 indicates that a company may have difficulty meeting its short-term obligations.

Based on the data provided for Ovintiv Inc, the quick ratio has been fluctuating over the past five years. In 2023, the quick ratio is 0.60, slightly lower than the previous year's ratio of 0.61. This indicates that Ovintiv Inc may have a decreased ability to cover its short-term liabilities with its quick assets in 2023 compared to 2022.

Looking back at the trend, the quick ratio has been relatively low in 2020 and 2021, with ratios of 0.51 and 0.58 respectively. This suggests that Ovintiv Inc faced challenges in meeting its short-term obligations in those years.

However, in 2019, the company had a quick ratio of 0.77, indicating a better ability to cover its short-term liabilities with its quick assets compared to the other years analyzed.

Overall, Ovintiv Inc's quick ratio has shown variability in recent years, with fluctuations that may reflect changes in the company's liquidity position and ability to meet its short-term obligations. Further analysis of the company's financial health and cash management policies would be necessary to fully assess its liquidity position.