PBF Energy Inc (PBF)

PBF Energy Inc's liquidity ratios provide insights into the company's ability to meet its short-term obligations. The current ratio, which measures the company's ability to pay off current liabilities with current assets, has shown some fluctuations over the past five years. The ratio has ranged from 1.26 in 2022 to 1.56 in 2023, suggesting an improvement in the company's short-term liquidity position in the most recent year.

The quick ratio, also known as the acid-test ratio, provides a more stringent measure of liquidity by excluding inventory from current assets. PBF Energy Inc's quick ratio has fluctuated over the years, ranging from 0.68 in 2019 to 0.89 in 2020. The ratio declined to 0.73 in 2022 but improved slightly to 0.81 in 2023.

The cash ratio, which indicates the proportion of current liabilities that can be covered by cash and cash equivalents, has also displayed variability in PBF Energy Inc's financial performance. The ratio has fluctuated from 0.35 in 2019 to 0.68 in 2020, showing an improvement in liquidity position in 2020. However, the ratio declined to 0.45 in 2022 before slightly increasing to 0.49 in 2023.

Overall, while the current ratio suggests an improvement in short-term liquidity in 2023, the quick ratio and cash ratio indicate some fluctuations in the company's ability to quickly cover its obligations with readily available assets. Further analysis and monitoring of liquidity trends are advisable to assess PBF Energy Inc's ongoing ability to meet its short-term financial commitments.

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Additional liquidity measure

Based on the data provided for PBF Energy Inc's cash conversion cycle over the past five years, we can observe fluctuations in the efficiency of the company's cash management and working capital.

In 2023, the cash conversion cycle was 37.82 days, indicating that PBF Energy Inc took approximately 37.82 days to convert its investments in raw materials into cash from sales, taking into account the time it took to sell inventory and collect receivables. This represents an increase from the previous year's cycle of 29.19 days, suggesting a slowdown in cash generation efficiency.

In 2022, there was a significant improvement in the cash conversion cycle, with the company taking only 29.19 days to convert its investments into cash. This was a positive trend compared to the prior year, reflecting effective management of working capital and faster conversion of assets into cash.

However, in 2021 and 2020, the cash conversion cycle increased to 41.52 days and 45.09 days, respectively. These longer cycles indicate potential challenges in managing inventory levels and collecting receivables, resulting in slower cash generation.

The cycle in 2019 was 38.39 days, showing a moderate efficiency level similar to the most recent year's cycle. Overall, fluctuations in PBF Energy Inc's cash conversion cycle over the past five years suggest varying levels of effectiveness in managing working capital and converting investments into cash efficiently. Further analysis of the company's operational and financial strategies may be needed to identify factors contributing to these fluctuations.