Viper Energy Ut (VNOM)
Liquidity ratios
| 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 | Dec 31, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 7.24 | 7.06 | 3.46 | 4.32 | 5.52 | 3.77 | 4.48 | 5.41 | 4.96 | 5.21 | 3.68 | 4.54 | 1.81 | 1.29 | 0.95 | 1.20 | 1.24 | 0.93 | 3.26 | 5.41 |
| Quick ratio | 3.81 | 1.21 | 0.36 | 0.80 | 3.09 | 0.47 | 3.10 | 4.55 | 4.22 | 4.72 | 3.55 | 4.41 | 1.44 | 1.22 | 0.85 | 1.14 | 0.89 | 0.90 | 3.22 | 4.59 |
| Cash ratio | 3.81 | 1.21 | 0.36 | 0.78 | 3.09 | 0.47 | 0.31 | 0.83 | 0.46 | 0.16 | 0.89 | 1.61 | 0.67 | 0.62 | 0.19 | 0.43 | 0.17 | 0.21 | 1.66 | 0.27 |
The liquidity ratios of Viper Energy Ut indicate the company's ability to meet its short-term obligations. The current ratio has generally been strong, ranging from 7.06 to 7.24 in the recent periods, signifying that the company has more than enough current assets to cover its current liabilities. This indicates a healthy liquidity position.
However, the quick ratio, which excludes inventory from current assets, shows greater variability, with values ranging from 0.36 to 4.72. This suggests that the company may face some liquidity challenges if it needed to meet its obligations quickly without relying on inventory.
The cash ratio, which is the most conservative measure of liquidity, has also fluctuated significantly, ranging from 0.16 to 3.81. This ratio indicates the company's ability to settle its current liabilities with only its most liquid asset, cash.
Overall, Viper Energy Ut has maintained strong liquidity positions based on the current ratio, but the quick and cash ratios reveal potential liquidity vulnerabilities, especially in periods where these ratios were lower. Management should continue monitoring these ratios to ensure a healthy balance between liquidity and operational efficiency.
Additional liquidity measure
| 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 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 0.00 | 0.00 | 0.00 | 1.19 | 0.00 | 0.00 | 38.87 | 57.48 | 55.00 | 63.83 | 58.91 | 49.34 | 40.99 | 43.68 | 56.68 | 46.82 | 43.57 | 42.46 | 45.67 | 71.08 |
The cash conversion cycle of Viper Energy Ut has shown fluctuations over the past several quarters. The cycle represents the time it takes for a company to convert its resources invested in inventory into cash flows from sales.
In the most recent quarter ending September 30, 2024, the company achieved an ultra-efficient cash conversion cycle of 0.00 days, indicating that it was able to convert its inventory into cash almost instantaneously. This likely suggests strong inventory management and quick turnover of goods.
Looking back over the previous quarters, the company has generally maintained a low cash conversion cycle, with occasional spikes in cycles observed in the past where the time to convert inventory into cash was higher, such as in December 2023 and March 2023. These spikes may indicate potential inefficiencies in inventory management or delays in collecting receivables.
The decreasing trend in the cash conversion cycle from 71.08 days in December 2019 to 0.00 days in September 2024 reflects the company's efforts to streamline its operations and improve its working capital efficiency. Overall, a shorter cash conversion cycle is positive as it signifies that the company is able to generate cash quickly from its operating activities, enhancing its financial position and liquidity.