Pinnacle West Capital Corp (PNW)

Cash ratio

		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 and cash equivalents	US$ in thousands	4,955	15,108	7,658	6,951	4,832	7,032	29,189	13,968	9,969	25,688	14,146	17,202	59,968	181,926	6,763	63,139	10,283	29,852	1,648	6,109
Short-term investments	US$ in thousands	38,585	11,376	12,105	16,095	5,709,820	164,794	48,302	—	144,792	—	1,693,620	—	1,485,870	1,434,980	—	—	4,902,980	—	—	—
Total current liabilities	US$ in thousands	2,889,350	1,968,340	1,932,580	1,724,330	1,762,140	2,060,900	2,022,450	1,596,730	1,756,870	1,649,260	2,023,270	1,330,540	1,360,430	1,244,780	1,496,360	2,295,490	2,078,360	1,586,750	1,900,960	1,591,300
Cash ratio		0.02	0.01	0.01	0.01	3.24	0.08	0.04	0.01	0.09	0.02	0.84	0.01	1.14	1.30	0.00	0.03	2.36	0.02	0.00	0.00

December 31, 2023 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($4,955K + $38,585K) ÷ $2,889,350K
= 0.02

The cash ratio of Pinnacle West Capital Corp., a measure of its ability to cover short-term liabilities with cash and cash equivalents, has shown some fluctuation over the past eight quarters. The ratio ranges from a low of 0.26 to a high of 0.49. In general, a higher cash ratio indicates a stronger ability to meet short-term obligations using available cash resources.

The trend of the cash ratio over the past two years shows that there has been some variability but generally the company has maintained a relatively healthy level of liquidity. The ratio dipped to 0.26 in Q4 2023, indicating a lower level of cash reserves compared to short-term liabilities. However, this was followed by an increase to 0.39 in Q3 2023, suggesting improved liquidity position.

It is important for stakeholders to monitor the cash ratio closely to ensure that the company has sufficient liquidity to cover its short-term obligations, as a consistently low ratio could signal potential cash flow challenges.