Charter Communications Inc. (NASDAQ:CHTR)

The analysis of the liquidity ratios over the observed quarters reveals consistent patterns and modest fluctuations. The current ratio, which measures the company's ability to meet short-term obligations with current assets, generally remains below 0.5 throughout the period. It experienced a slight increase around the first quarter of 2022, reaching 0.4, followed by a stabilization near the 0.3 to 0.4 range in subsequent periods. This level indicates a relatively low margin of current assets over current liabilities, suggesting limited short-term liquidity buffers.

The quick ratio, focusing on the most liquid assets excluding inventories, follows a similar trend to the current ratio but remains marginally lower in almost all quarters. It hovers mostly between 0.25 and 0.36, with a brief increase observed in early 2022. This indicates that the company has slightly less liquidity when inventories are excluded, but the overall liquidity position remains constrained.

The cash ratio, representing the company's ability to cover current liabilities using only cash and cash equivalents, consistently shows the lowest values among the three ratios. It fluctuates mainly between 0.03 and 0.17, with sporadic peaks occurring in the first quarters of 2021 and 2022. Despite these occasional increases, the ratio is generally very low, implying that cash holdings are minimal relative to current liabilities and the company relies on other current assets to meet short-term obligations.

Overall, the liquidity analysis indicates that the company maintains relatively tight liquidity throughout the observed timeframe, with slight seasonal improvements at the start of each year. While the ratios do not show significant upward or downward trends, they suggest a consistent approach to current asset management and a limited cushion against short-term financial pressures.

The analysis of the quarterly financial data reveals notable trends in the liquidity and working capital position over the examined periods.

Current Assets

Current assets exhibit fluctuations throughout the periods, with an initial increase from 3,663 million to 4,682 million US dollars between March and June 2021, followed by declines and moderate recoveries in subsequent quarters. Notable peaks occur around March 2022 (5,516 million) and March 2025 (4,968 million), indicating some variability but generally maintaining a level between approximately 3,500 and 5,500 million US dollars. The asset base does not demonstrate a clear persistent upward or downward trend but rather cyclical changes.

Current Liabilities

Current liabilities follow an overall upward trajectory over the periods. Starting from 9,916 million US dollars in March 2021, the liabilities increase consistently, reaching approximately 14,556 million US dollars by June 2025. While some periods show minor decreases or stabilization (e.g., around mid-2024), the prevailing trend points toward growing current obligations, which may imply increased short-term financial commitments or operational scaling.

Current Ratio

The current ratio remains consistently below 1.0, indicating that current liabilities substantially exceed current assets in all quarters examined. The ratio fluctuates between approximately 0.29 and 0.47, with its lowest points occurring around late 2021 and highest points near mid-2021 and early 2022. This stable yet low ratio suggests persistent liquidity constraints, where the company may face challenges in covering short-term obligations solely through existing current assets.

In summary, the data indicates that although current assets vary without a definitive trend, current liabilities have increased steadily, resulting in a consistently low current ratio. This pattern reflects a continual pressure on short-term liquidity, which might necessitate strategic attention to working capital management to ensure operational resilience and financial stability in the near term.

The analysis of the quarterly data reveals several noteworthy trends in the company's liquidity position over the observed periods.

Total Quick Assets

The total quick assets exhibit a fluctuating pattern with intermittent increases and decreases throughout the timeline. Starting at 3,167 million USD in the first quarter of 2021, quick assets peaked at 4,961 million USD in the first quarter of 2022, indicating a significant increase in liquid assets availability relative to prior periods. However, following this peak, the values declined and stabilized around the 3,300 to 3,700 million USD range for a considerable part of 2022 and 2023. A gradual upward trend is observed again towards the end of the reported timeline, reaching 4,155 million USD by the second quarter of 2025.

Current Liabilities

Current liabilities generally present an upward trajectory, rising from 9,916 million USD in the first quarter of 2021 to 14,556 million USD by the second quarter of 2025. Despite occasional minor declines or plateaus, the overall trend suggests increasing short-term obligations. Notably, there is a marked increase around early 2022, with liabilities rising sharply to approximately 13,929 million USD and continuing an ascending trend beyond this point, signaling potentially greater reliance on short-term liabilities or increased operational obligations.

Quick Ratio

The quick ratio remains consistently below 0.5 throughout the observed periods, indicating that the company’s most liquid assets do not sufficiently cover its current liabilities. The ratio fluctuates between 0.25 and 0.43 early on, with a peak of 0.43 in the second quarter of 2021. Subsequently, the ratio decreases and stabilizes mostly around the 0.28 to 0.30 range during 2022 and 2023, reflecting a relatively tight liquidity position. An improvement is seen intermittently in 2024 reaching approximately 0.34 but declines again afterward. By the end of the timeline, the ratio slightly improves but remains under 0.35, underscoring persistent liquidity constraints.

In summary, the company’s liquidity, as measured by total quick assets and quick ratio, indicates variability but overall presents challenges in covering short-term liabilities fully with liquid assets. The steady increase in current liabilities without corresponding consistent growth in quick assets has exerted downward pressure on the quick ratio, implying an ongoing need to monitor liquidity risk carefully. These trends suggest a moderately constrained liquidity position throughout the periods covered, with some short-term improvements that nevertheless fall short of substantially strengthening the company’s immediate financial resilience.

The analysis of the financial indicators over the observed quarters reveals distinct trends in liquidity and short-term obligations.

Total Cash Assets

Total cash assets exhibit a high degree of volatility over the reported periods. Initially, there is a significant increase from 772 million to 1711 million, followed by a sharp decline to 466 million. Subsequently, fluctuations continue, with values ranging between approximately 450 million and 2400 million. Notably, a peak occurs in March 2022 at 2431 million, succeeded by a general downward trend and more stable but lower figures in later quarters.

Current Liabilities

Current liabilities steadily increase over the timeframe. Starting at 9916 million, the amount rises consistently with minor short-term decreases, reaching 14556 million by June 2025. This upward trend indicates growing short-term financial obligations.

Cash Ratio

The cash ratio remains consistently low throughout all quarters, fluctuating mostly between 0.03 and 0.17. There is no indication of a sustained improvement in liquidity relative to current liabilities. Early periods show slightly higher ratios (up to 0.17), but these are not maintained in later quarters, where the ratio mostly declines or remains near 0.04 to 0.06.

In summary, the company experiences fluctuating cash reserves that do not consistently cover its increasing current liabilities. The persistently low cash ratio suggests limited immediate liquidity, which may impact the ability to meet short-term obligations without relying on other sources of financing or asset liquidation. This trend warrants close monitoring to manage liquidity risk effectively.