Valero Energy Corporation (VLO)
Liquidity ratios
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 1.53 | 1.57 | 1.48 | 1.59 | 1.56 | 1.51 | 1.59 | 1.52 | 1.38 | 1.32 | 1.25 | 1.18 | 1.26 | 1.31 | 1.36 | 1.43 | 1.71 | 1.90 | 1.75 | 1.31 |
| Quick ratio | 0.30 | 0.34 | 0.29 | 0.31 | 0.33 | 0.34 | 0.35 | 0.37 | 0.28 | 0.23 | 0.25 | 0.13 | 0.24 | 0.24 | 0.25 | 0.18 | 0.36 | 0.50 | 0.32 | 0.17 |
| Cash ratio | 0.30 | 0.34 | 0.29 | 0.31 | 0.33 | 0.34 | 0.35 | 0.37 | 0.28 | 0.23 | 0.25 | 0.13 | 0.24 | 0.24 | 0.25 | 0.18 | 0.36 | 0.50 | 0.32 | 0.17 |
Based on the provided data, the liquidity ratios of Valero Energy Corporation over the past few years exhibit the following trends:
1. Current Ratio: The current ratio, which measures the company's ability to cover its short-term liabilities with current assets, has shown some fluctuations but remained above 1 in most periods. This suggests that Valero Energy Corporation generally has sufficient current assets to meet its short-term obligations.
2. Quick Ratio: The quick ratio, also known as the acid-test ratio, provides a more stringent measure of liquidity as it excludes inventory from current assets. Valero Energy Corporation's quick ratio has varied over time but has generally been lower than the current ratio. This indicates that the company may have a relatively lower ability to quickly cover its short-term liabilities without relying on selling inventory.
3. Cash Ratio: The cash ratio, which is the strictest measure of liquidity as it looks at the ability to cover current liabilities only with cash and cash equivalents, has shown a similar trend to the quick ratio. Valero Energy Corporation's cash ratio has been relatively low compared to the current ratio, reflecting a dependence on assets other than cash to meet short-term obligations.
Overall, while Valero Energy Corporation maintains a current ratio above 1, indicating a reasonable level of liquidity, the quick ratio and cash ratio suggest that the company may have limitations in quickly meeting its short-term obligations with its most liquid assets. Continued monitoring of these ratios is important to ensure the company's liquidity position remains healthy.
See also:
Additional liquidity measure
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 22.63 | 20.00 | 22.35 | 22.29 | 20.99 | 20.25 | 17.99 | 17.57 | 15.44 | 15.45 | 18.02 | 20.68 | 20.62 | 24.25 | 27.39 | 34.22 | 33.54 | 26.16 | 23.37 | 12.89 |
The cash conversion cycle of Valero Energy Corporation has shown some fluctuations over the past few years. It measures the time it takes for a company to convert its investments in inventory into cash flows from sales.
The trend in Valero Energy Corporation's cash conversion cycle shows an increase from around 12.89 days as of March 31, 2020, to a peak of 34.22 days by March 31, 2021. However, the company managed to reduce this cycle to 15.44 days by December 31, 2022. Subsequently, the cash conversion cycle increased slightly to 22.63 days by December 31, 2024.
Overall, Valero Energy Corporation's cash conversion cycle has shown some variability but has generally trended towards lower values in recent periods. This indicates that the company's efficiency in managing its working capital and converting its inventory to cash has improved, which can be a positive sign for its financial health and operational performance.