Analysis of Liquidity Ratios
Quarterly Data
Liquidity ratios measure the company ability to meet its short-term obligations.
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Liquidity Ratios (Summary)
Anadarko Petroleum Corp., liquidity ratios (quarterly data)
Based on: 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-K (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-K (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31), 10-K (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-Q (reporting date: 2014-06-30), 10-Q (reporting date: 2014-03-31), 10-K (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30), 10-Q (reporting date: 2013-06-30), 10-Q (reporting date: 2013-03-31), 10-K (reporting date: 2012-12-31), 10-Q (reporting date: 2012-09-30), 10-Q (reporting date: 2012-06-30), 10-Q (reporting date: 2012-03-31).
The analysis of liquidity ratios over the specified periods reveals notable fluctuations with distinct trends emerging in different phases.
- Current Ratio
- The current ratio demonstrated a general decline from the early periods in 2012 and 2013, starting near 1.78 and gradually decreasing to below 1.0 by early 2014. This downturn indicates a reduction in short-term asset coverage against current liabilities during that time. Following this low point, the ratio stabilized around the 1.0 mark through 2015 and early 2016, suggesting a balance between current assets and liabilities. From late 2016 onward, there was a significant improvement, with the ratio increasing sharply from below 1.0 to above 2.0 by mid-2017. This recovery indicates a strengthened liquidity position, with current assets more than doubling current liabilities, suggesting improved short-term financial health toward the end of the observed period.
- Quick Ratio
- The quick ratio mirrored the pattern of the current ratio but consistently registered lower values, as expected due to its exclusion of inventory. Initially, the quick ratio decreased from around 1.27 in early 2012 to below 1.0 in early 2014, reflecting tightening immediate liquidity. It then fluctuated modestly during 2014 and 2015, remaining near or just below 1.0, which indicates marginal ability to cover current liabilities with liquid assets. In late 2016 and through 2017, the quick ratio increased substantially, surpassing 1.9 by mid-2017, indicating an enhanced capacity to meet short-term obligations without relying on inventory sales.
- Cash Ratio
- The cash ratio, representing the most stringent measure of liquidity, started at 0.6 in early 2012 and displayed a general downward trend with intermittent recoveries until late 2015 and early 2016, reaching lows near 0.22. This indicates a period where readily available cash and equivalents were relatively low compared to current liabilities. From late 2016 onwards, the cash ratio showed a marked and rapid increase, peaking above 1.9 by mid-2017. This substantial improvement suggests a strong buildup of cash reserves relative to liabilities, reflecting a highly liquid position near the end of the observed timeframe.
Overall, the financial data indicates a challenging liquidity position during 2013 and early 2014, characterized by ratios often below or near 1.0, implying potential short-term financial stress. The period from 2015 through mid-2016 shows slight improvements but still moderate liquidity. A strong recovery is observed from late 2016 onwards, with all three ratios improving markedly and suggesting robust liquidity and enhanced financial flexibility by mid-2017.
Current Ratio
Anadarko Petroleum Corp., current ratio calculation (quarterly data)
| Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Sep 30, 2015 | Jun 30, 2015 | Mar 31, 2015 | Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | Sep 30, 2012 | Jun 30, 2012 | Mar 31, 2012 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||||||
| Current assets | ||||||||||||||||||||||||||||||
| Current liabilities | ||||||||||||||||||||||||||||||
| Liquidity Ratio | ||||||||||||||||||||||||||||||
| Current ratio1 | ||||||||||||||||||||||||||||||
| Benchmarks | ||||||||||||||||||||||||||||||
| Current Ratio, Competitors2 | ||||||||||||||||||||||||||||||
| Chevron Corp. | ||||||||||||||||||||||||||||||
| ConocoPhillips | ||||||||||||||||||||||||||||||
| Exxon Mobil Corp. | ||||||||||||||||||||||||||||||
| Occidental Petroleum Corp. | ||||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-K (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-K (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31), 10-K (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-Q (reporting date: 2014-06-30), 10-Q (reporting date: 2014-03-31), 10-K (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30), 10-Q (reporting date: 2013-06-30), 10-Q (reporting date: 2013-03-31), 10-K (reporting date: 2012-12-31), 10-Q (reporting date: 2012-09-30), 10-Q (reporting date: 2012-06-30), 10-Q (reporting date: 2012-03-31).
1 Q3 2017 Calculation
Current ratio = Current assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals several notable trends in the company's liquidity position over the examined periods.
- Current Assets:
- Current assets demonstrated fluctuations throughout the period, beginning at 8,714 million US dollars at the end of the first quarter of 2012 and decreasing to a low of 3,982 million in the fourth quarter of 2015. Subsequently, there was a recovery trend with values rising again to approximately 7,984 million by the second quarter of 2017. Notably, the largest peak occurred in the third quarter of 2014, reaching 11,739 million US dollars, indicating a significant increase in short-term resources available during that time.
- Current Liabilities:
- Current liabilities exhibited considerable volatility without a clear directional trend. Starting at 4,897 million US dollars in the first quarter of 2012, liabilities surged to a peak of 10,983 million in the third quarter of 2014, closely mirroring the spike in current assets around the same time. Following this peak, a pronounced decline was observed, dropping to near 3,154 million by mid-2017. This reduction suggests successful efforts in managing short-term obligations in the later periods.
- Current Ratio:
- The current ratio, which measures the company's ability to cover its short-term liabilities with short-term assets, fluctuated significantly across quarters. Initial quarters in 2012 showed relatively strong ratios above 1.4, indicating good liquidity. The ratio experienced a notable decline in 2014, reaching below 1.1, which signifies potential liquidity constraints. However, from 2015 onwards, the ratio generally improved, culminating in a peak of 2.53 in the second quarter of 2017, reflecting a substantially strengthened liquidity position and enhanced ability to settle short-term debts.
In summary, the company encountered periods of financial strain around 2014 and 2015 characterized by reduced current ratios and volatile asset and liability balances. These challenges were followed by a period of recovery and strengthening liquidity through 2016 and 2017, as evidenced by rising current assets paired with declining current liabilities and an increasing current ratio. This recovery signifies improved financial stability and a stronger short-term financial foundation in the latest quarters analyzed.
Quick Ratio
Anadarko Petroleum Corp., quick ratio calculation (quarterly data)
| Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Sep 30, 2015 | Jun 30, 2015 | Mar 31, 2015 | Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | Sep 30, 2012 | Jun 30, 2012 | Mar 31, 2012 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||||||
| Cash and cash equivalents | ||||||||||||||||||||||||||||||
| Accounts receivable, net of allowance, customers | ||||||||||||||||||||||||||||||
| Accounts receivable, net of allowance, others | ||||||||||||||||||||||||||||||
| Total quick assets | ||||||||||||||||||||||||||||||
| Current liabilities | ||||||||||||||||||||||||||||||
| Liquidity Ratio | ||||||||||||||||||||||||||||||
| Quick ratio1 | ||||||||||||||||||||||||||||||
| Benchmarks | ||||||||||||||||||||||||||||||
| Quick Ratio, Competitors2 | ||||||||||||||||||||||||||||||
| Chevron Corp. | ||||||||||||||||||||||||||||||
| ConocoPhillips | ||||||||||||||||||||||||||||||
| Exxon Mobil Corp. | ||||||||||||||||||||||||||||||
| Occidental Petroleum Corp. | ||||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-K (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-K (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31), 10-K (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-Q (reporting date: 2014-06-30), 10-Q (reporting date: 2014-03-31), 10-K (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30), 10-Q (reporting date: 2013-06-30), 10-Q (reporting date: 2013-03-31), 10-K (reporting date: 2012-12-31), 10-Q (reporting date: 2012-09-30), 10-Q (reporting date: 2012-06-30), 10-Q (reporting date: 2012-03-31).
1 Q3 2017 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
The financial data indicates fluctuating trends in liquidity measures over the observed quarters. The total quick assets exhibit noticeable variations, increasing significantly during certain periods and declining in others. For example, a marked rise in quick assets occurs from March 2014 to September 2014, reaching a peak before declining again by the end of 2015. Another period of increase is evident in early 2017.
Current liabilities also demonstrate variability, with some quarters showing substantial increases, notably between March 2014 and December 2014, where liabilities nearly double compared to previous periods. Following this peak, liabilities reduce and stabilize somewhat, although there remain fluctuations through 2016 and 2017.
The quick ratio, which assesses the company's short-term liquidity by comparing quick assets to current liabilities, reflects these changes. The ratio generally remains above 1 during the early periods, indicating that quick assets exceeded current liabilities. However, it drops below 1 in several quarters, particularly in 2014 and parts of 2015 and 2016, suggesting tighter liquidity conditions during those times. Towards 2017, the quick ratio improves markedly, surpassing 1.9, indicating enhanced short-term financial strength.
- Total Quick Assets
- Show a pattern of significant increase in early 2014 and early 2017, with interim periods of decline and relative stability.
- Current Liabilities
- Experience substantial rises during mid-2014, followed by decreases and moderate fluctuations in subsequent quarters.
- Quick Ratio
- Ranges from below 1 to values above 2, reflecting periods of both strained and strong liquidity positions; notable improvement is observed in 2017.
Overall, the data suggests the company faced liquidity challenges around 2014 and parts of 2015-2016, with recovery and improved liquidity conditions evident by 2017. The correlation between spikes in current liabilities and decreases in the quick ratio highlights the impact of liabilities on short-term financial health, while changes in quick assets generally contribute to these fluctuations.
Cash Ratio
Anadarko Petroleum Corp., cash ratio calculation (quarterly data)
| Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Sep 30, 2015 | Jun 30, 2015 | Mar 31, 2015 | Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | Sep 30, 2012 | Jun 30, 2012 | Mar 31, 2012 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||||||
| Cash and cash equivalents | ||||||||||||||||||||||||||||||
| Total cash assets | ||||||||||||||||||||||||||||||
| Current liabilities | ||||||||||||||||||||||||||||||
| Liquidity Ratio | ||||||||||||||||||||||||||||||
| Cash ratio1 | ||||||||||||||||||||||||||||||
| Benchmarks | ||||||||||||||||||||||||||||||
| Cash Ratio, Competitors2 | ||||||||||||||||||||||||||||||
| Chevron Corp. | ||||||||||||||||||||||||||||||
| ConocoPhillips | ||||||||||||||||||||||||||||||
| Exxon Mobil Corp. | ||||||||||||||||||||||||||||||
| Occidental Petroleum Corp. | ||||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-K (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-Q (reporting date: 2016-03-31), 10-K (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-Q (reporting date: 2015-03-31), 10-K (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-Q (reporting date: 2014-06-30), 10-Q (reporting date: 2014-03-31), 10-K (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30), 10-Q (reporting date: 2013-06-30), 10-Q (reporting date: 2013-03-31), 10-K (reporting date: 2012-12-31), 10-Q (reporting date: 2012-09-30), 10-Q (reporting date: 2012-06-30), 10-Q (reporting date: 2012-03-31).
1 Q3 2017 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals notable fluctuations in total cash assets, current liabilities, and cash ratio over the observed time periods.
- Total Cash Assets
- Total cash assets show an initial decline from $2,957 million in March 2012 to $2,471 million by December 2012. This is followed by a significant increase through 2013 and 2014, with the peak reaching $8,335 million in September 2014. Thereafter, a marked downward trend is observed starting in 2015, with assets decreasing sharply to a low of $939 million in December 2015. A partial recovery occurs afterward, with fluctuations between approximately $1,394 million and $6,008 million by mid-2017, ending at $5,251 million in September 2017.
- Current Liabilities
- Current liabilities exhibit volatility throughout the periods. Starting at $4,897 million in March 2012, liabilities increase to $5,883 million in June 2012, then decline to $3,994 million by December 2012. The subsequent years show elevated liabilities, peaking at $10,983 million in September 2014. A decline follows in 2015, reaching approximately $4,181 million by December 2015. From 2016 onward, current liabilities experience moderate fluctuations, ranging generally between $3,154 million and $6,657 million, reflecting some instability but no consistent trend.
- Cash Ratio
- Throughout the data, the cash ratio demonstrates considerable variability that corresponds with movements in cash assets and current liabilities. Initially, the cash ratio fluctuates around the 0.5 to 0.9 range up to late 2014. During 2015, it declines to a low of 0.22 by December, coinciding with the trough in cash assets and sustained current liabilities. A significant improvement in liquidity is observed beginning in 2016, with the cash ratio exceeding 1.0 by December 2016 and reaching a peak of 1.9 in June 2017. The ratio slightly diminishes to 1.43 by September 2017 but remains well above the earlier period levels, indicating stronger short-term financial stability in recent quarters.
In summary, the data depict a period of fluctuating liquidity characterized by substantial cash asset growth through 2014, a sharp contraction in 2015, and recovery thereafter. Current liabilities vary markedly, especially around 2014, impacting liquidity measures. The improvement in the cash ratio from 2016 onward suggests enhanced ability to cover short-term obligations with available liquid assets, pointing to a strengthening in the company's short-term financial position in the more recent periods.