Analysis of Liquidity Ratios
Quarterly Data
Liquidity ratios measure the company ability to meet its short-term obligations.
Liquidity Ratios (Summary)
Apache Corp., liquidity ratios (quarterly data)
Based on: 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), 10-K (reporting date: 2011-12-31), 10-Q (reporting date: 2011-09-30), 10-Q (reporting date: 2011-06-30), 10-Q (reporting date: 2011-03-31).
- Current Ratio Analysis
- The current ratio demonstrated moderate fluctuations over the analyzed period. Starting at 1.01 in March 2011, it showed a slight increase reaching a peak of 1.14 in September 2011, before declining to a low of 0.87 in March 2013. From this trough, a general upward trend was observed, culminating in a significant improvement to 2.10 by June 2016. Notably, this increase from early 2014 onward reflects a strengthening in the company's short-term liquidity position, suggesting improved ability to cover current liabilities with current assets.
- Quick Ratio Analysis
- The quick ratio followed a somewhat similar pattern to the current ratio but exhibited more pronounced variability. Beginning at 0.72 in March 2011, it slightly increased to 0.8 in June 2011, then declined and remained below 1.0 for several years, reaching a nadir of 0.36 in June 2015. The period after mid-2015 showed a strong rebound, with the ratio climbing dramatically to 1.41 by June 2016. This sharp increase, particularly the surge between June 2015 and June 2016, indicates enhanced liquidity in terms of more liquid assets excluding inventory, which improved the company’s capacity to meet short-term obligations without relying on inventory liquidation.
- Cash Ratio Analysis
- The cash ratio was relatively low and stable from March 2011 until early 2014, generally fluctuating between 0.03 and 0.28. It saw modest peaks such as 0.41 in December 2013 but generally remained below 0.3 until mid-2014. From 2014 onwards, the cash ratio showed significant volatility, culminating in a dramatic increase to 1.24 in June 2015. Although it decreased somewhat after that peak, it remained well above prior levels, stabilizing between 0.64 and 0.80 by mid-2016. This pattern suggests that cash and cash-equivalents holdings grew considerably from 2014 to 2016, reflecting a strategic shift towards maintaining higher immediate liquidity buffers.
- Overall Liquidity Insights
- Across the three liquidity measures, there is a clear illustration of improved liquidity from 2014 onwards. Prior to that, ratios were mostly around or below 1, indicating tight liquidity conditions and potentially limited ability to cover short-term liabilities comfortably. Subsequent to 2014, all ratios improved significantly, with the current and quick ratios surpassing the threshold of 1, and the cash ratio increasing to levels above 0.6. This shift may reflect enhanced cash management, a reduction in short-term liabilities, or an increase in current and liquid assets. The substantial rise in liquidity ratios during this latter period points to strengthened financial health in terms of meeting short-term obligations.
Current Ratio
Apache Corp., current ratio calculation (quarterly data)
| 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 | Dec 31, 2011 | Sep 30, 2011 | Jun 30, 2011 | Mar 31, 2011 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||||||
| Current assets | 3,292) | 3,260) | 3,752) | 4,079) | 5,493) | 5,906) | 6,415) | 4,426) | 5,126) | 5,463) | 6,366) | 6,016) | 4,758) | 4,848) | 4,962) | 5,044) | 4,639) | 4,954) | 4,803) | 4,576) | 4,900) | 4,001) | |||||||
| Current liabilities | 1,570) | 1,565) | 1,841) | 2,167) | 2,383) | 5,493) | 3,664) | 4,307) | 4,570) | 4,356) | 4,700) | 4,523) | 5,158) | 5,562) | 5,536) | 5,390) | 5,121) | 4,698) | 4,963) | 4,024) | 4,484) | 3,957) | |||||||
| Liquidity Ratio | |||||||||||||||||||||||||||||
| Current ratio1 | 2.10 | 2.08 | 2.04 | 1.88 | 2.31 | 1.08 | 1.75 | 1.03 | 1.12 | 1.25 | 1.35 | 1.33 | 0.92 | 0.87 | 0.90 | 0.94 | 0.91 | 1.05 | 0.97 | 1.14 | 1.09 | 1.01 | |||||||
| Benchmarks | |||||||||||||||||||||||||||||
| Current Ratio, Competitors2 | |||||||||||||||||||||||||||||
| Chevron Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| ConocoPhillips | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Exxon Mobil Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Occidental Petroleum Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 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), 10-K (reporting date: 2011-12-31), 10-Q (reporting date: 2011-09-30), 10-Q (reporting date: 2011-06-30), 10-Q (reporting date: 2011-03-31).
1 Q2 2016 Calculation
Current ratio = Current assets ÷ Current liabilities
= 3,292 ÷ 1,570 = 2.10
2 Click competitor name to see calculations.
- Current Assets
- The current assets exhibit fluctuations over the observed periods. Initially, from March 2011 to June 2011, there is a noticeable increase from 4001 million USD to 4900 million USD, followed by some volatility but generally stable values around the 4600-5000 million USD range through 2012. A rise is again seen in late 2013 into early 2014, reaching peaks around 6415 million USD by December 2014. However, starting in early 2015 there is a declining trend that continues steadily through mid-2016, dropping to approximately 3292 million USD by June 2016. This indicates a reduction in liquid or short-term assets available over the latter periods.
- Current Liabilities
- Current liabilities show a somewhat irregular pattern, though with an overall declining trend towards the end of the period. Initially, liabilities rose from 3957 million USD in March 2011 to a peak around 5536 million USD by December 2012. Subsequently, the liabilities decreased substantially, particularly noticeable between March 2014 and June 2016, dropping from around 4356 million USD to approximately 1570 million USD. Notably, there is an anomalous spike at March 2015 with a value of 5493 million USD, before the sharp decline resumes. This reduction in current liabilities could suggest improved short-term debt management or pay-down.
- Current Ratio
- The current ratio, a key liquidity indicator, demonstrates considerable variability. The ratio starts near parity at 1.01 in March 2011, peaks above 1.3 in late 2013, and falls below 1.0 at several points in 2011 and 2012, indicating periods of potential liquidity constraints. From mid-2014 onwards, the current ratio trends upwards markedly, reaching values over 2.0 in 2015 and mid-2016, reflecting a significant improvement in liquidity. The high ratios in these periods suggest the company has more than double the current assets relative to current liabilities, indicating strong short-term financial health and an increased ability to cover obligations.
- Overall Analysis
- Over the entire timeframe, the data reveals fluctuating yet improving liquidity conditions. Early periods show tight liquidity with current ratios occasionally below 1, suggesting potential short-term stress. Mid to late periods depict a reversal, with a notable rise in the current ratio driven both by declining current liabilities and relatively sustained current assets, despite a late decline in the latter. The spike and subsequent fall in liabilities around early 2015 may reflect specific financial activities or restructuring. The overall pattern points towards enhanced liquidity management and a stronger financial position in terms of meeting short-term obligations by mid-2016.
Quick Ratio
Apache Corp., quick ratio calculation (quarterly data)
| 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 | Dec 31, 2011 | Sep 30, 2011 | Jun 30, 2011 | Mar 31, 2011 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||||||
| Cash and cash equivalents | 1,201) | 1,004) | 1,467) | 1,655) | 2,950) | 229) | 769) | 510) | 524) | 1,643) | 1,906) | 1,251) | 184) | 248) | 160) | 318) | 361) | 245) | 295) | 586) | 1,107) | 356) | |||||||
| Short-term restricted cash | —) | —) | —) | —) | —) | —) | —) | 74) | 778) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | |||||||
| Receivables, net of allowance | 1,016) | 1,120) | 1,253) | 1,332) | 1,589) | 1,767) | 2,024) | 2,287) | 2,407) | 2,479) | 2,952) | 3,086) | 2,914) | 3,106) | 3,086) | 2,976) | 2,625) | 3,163) | 3,079) | 2,560) | 2,495) | 2,490) | |||||||
| Total quick assets | 2,217) | 2,124) | 2,720) | 2,987) | 4,539) | 1,996) | 2,793) | 2,871) | 3,709) | 4,122) | 4,858) | 4,337) | 3,098) | 3,354) | 3,246) | 3,294) | 2,986) | 3,408) | 3,374) | 3,146) | 3,602) | 2,846) | |||||||
| Current liabilities | 1,570) | 1,565) | 1,841) | 2,167) | 2,383) | 5,493) | 3,664) | 4,307) | 4,570) | 4,356) | 4,700) | 4,523) | 5,158) | 5,562) | 5,536) | 5,390) | 5,121) | 4,698) | 4,963) | 4,024) | 4,484) | 3,957) | |||||||
| Liquidity Ratio | |||||||||||||||||||||||||||||
| Quick ratio1 | 1.41 | 1.36 | 1.48 | 1.38 | 1.90 | 0.36 | 0.76 | 0.67 | 0.81 | 0.95 | 1.03 | 0.96 | 0.60 | 0.60 | 0.59 | 0.61 | 0.58 | 0.73 | 0.68 | 0.78 | 0.80 | 0.72 | |||||||
| Benchmarks | |||||||||||||||||||||||||||||
| Quick Ratio, Competitors2 | |||||||||||||||||||||||||||||
| Chevron Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| ConocoPhillips | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Exxon Mobil Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Occidental Petroleum Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 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), 10-K (reporting date: 2011-12-31), 10-Q (reporting date: 2011-09-30), 10-Q (reporting date: 2011-06-30), 10-Q (reporting date: 2011-03-31).
1 Q2 2016 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= 2,217 ÷ 1,570 = 1.41
2 Click competitor name to see calculations.
- Total Quick Assets
- The total quick assets fluctuated throughout the observed periods, initially increasing from 2,846 million USD in March 2011 to a peak of 4,858 million USD in December 2013. Subsequently, a decline occurred from early 2014 through the majority of 2015, reaching a low point of 1,996 million USD in March 2015. Thereafter, the values moderately recovered, ending at 2,217 million USD by June 2016. This pattern suggests varying liquidity conditions over time, with notable growth in late 2013 followed by contraction and a partial recovery.
- Current Liabilities
- Current liabilities exhibited an increasing trend from March 2011, starting at 3,957 million USD and rising to a peak of 5,536 million USD in December 2012. From 2013 onward, these liabilities generally decreased, reaching the lowest value of 1,565 million USD in March 2016, before stabilizing around 1,570 million USD by mid-2016. The initial rise in liabilities followed by a steady reduction indicates efforts to manage short-term obligations more effectively in the later years.
- Quick Ratio
- The quick ratio demonstrated considerable variability over the reported quarters. It started below 1.0, indicating less than one dollar of quick assets per dollar of current liabilities in early 2011. Notably, the ratio improved to over 1.0 by late 2013, peaking at 1.03 in December 2013, which reflects an enhanced liquidity position during this period. A sharp decline was observed in early 2015, dropping to 0.36 in March 2015, marking the weakest liquidity position in the dataset. This was followed by a strong recovery, with the ratio rising to approximately 1.4 by mid-2016, suggesting a significant restoration of financial liquidity and an improved capacity to cover short-term obligations without relying on inventory sales.
Cash Ratio
Apache Corp., cash ratio calculation (quarterly data)
| 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 | Dec 31, 2011 | Sep 30, 2011 | Jun 30, 2011 | Mar 31, 2011 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||||||
| Cash and cash equivalents | 1,201) | 1,004) | 1,467) | 1,655) | 2,950) | 229) | 769) | 510) | 524) | 1,643) | 1,906) | 1,251) | 184) | 248) | 160) | 318) | 361) | 245) | 295) | 586) | 1,107) | 356) | |||||||
| Short-term restricted cash | —) | —) | —) | —) | —) | —) | —) | 74) | 778) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | |||||||
| Total cash assets | 1,201) | 1,004) | 1,467) | 1,655) | 2,950) | 229) | 769) | 584) | 1,302) | 1,643) | 1,906) | 1,251) | 184) | 248) | 160) | 318) | 361) | 245) | 295) | 586) | 1,107) | 356) | |||||||
| Current liabilities | 1,570) | 1,565) | 1,841) | 2,167) | 2,383) | 5,493) | 3,664) | 4,307) | 4,570) | 4,356) | 4,700) | 4,523) | 5,158) | 5,562) | 5,536) | 5,390) | 5,121) | 4,698) | 4,963) | 4,024) | 4,484) | 3,957) | |||||||
| Liquidity Ratio | |||||||||||||||||||||||||||||
| Cash ratio1 | 0.76 | 0.64 | 0.80 | 0.76 | 1.24 | 0.04 | 0.21 | 0.14 | 0.28 | 0.38 | 0.41 | 0.28 | 0.04 | 0.04 | 0.03 | 0.06 | 0.07 | 0.05 | 0.06 | 0.15 | 0.25 | 0.09 | |||||||
| Benchmarks | |||||||||||||||||||||||||||||
| Cash Ratio, Competitors2 | |||||||||||||||||||||||||||||
| Chevron Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| ConocoPhillips | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Exxon Mobil Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
| Occidental Petroleum Corp. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||
Based on: 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), 10-K (reporting date: 2011-12-31), 10-Q (reporting date: 2011-09-30), 10-Q (reporting date: 2011-06-30), 10-Q (reporting date: 2011-03-31).
1 Q2 2016 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= 1,201 ÷ 1,570 = 0.76
2 Click competitor name to see calculations.
- Total Cash Assets
- The total cash assets display considerable volatility over the analyzed periods. Initially, the value rose substantially from 356 million USD at the end of Q1 2011 to a peak of 1,107 million USD in Q2 2011. Following this, there was a notable decline, with fluctuations occurring thereafter. A significant upward trend is observed in Q4 2013, reaching 1,906 million USD, followed by a gradual decrease through 2014 to early 2015. In Q2 2015, cash assets sharply increased to 2,950 million USD, the highest in the dataset, but subsequently decreased again, stabilizing around 1,000 to 1,200 million USD by mid-2016.
- Current Liabilities
- Current liabilities generally show a declining trend across the entire timeframe, though there are some fluctuations. Starting at 3,957 million USD in Q1 2011, liabilities rose to peak values above 5,500 million USD between Q3 2012 and Q1 2013. From early 2013 onward, there is a steady and notable reduction in current liabilities, dropping to approximately 1,565 million USD by Q1 2016 and maintaining similar levels through mid-2016. The reduction in liabilities indicates improving short-term financial obligations management.
- Cash Ratio
- The cash ratio experienced significant variability throughout the period. Initially low at 0.09 in Q1 2011, it increased sharply during Q2 2011 to 0.25 before declining again through 2012 to very low levels around 0.03. A substantial improvement is evident in late 2013, with the ratio peaking at 0.41, indicating improved liquidity. The ratio then decreased somewhat in 2014 and early 2015, followed by a dramatic increase in Q2 2015 to 1.24, reflecting a strong liquidity position. Although the ratio decreased somewhat after that, it remained above 0.6 through mid-2016, suggesting enhanced ability to cover current liabilities with cash assets over time.
- Summary
- Overall, the data indicates an improvement in liquidity position over the periods analyzed. The increase in the cash ratio alongside the reduction of current liabilities suggests stronger short-term financial health. Cash assets, despite notable fluctuations, reached their peak in mid-2015, contributing to the enhanced liquidity. The pattern reveals a concerted effort or outcome of financial management aimed at bolstering liquid assets and reducing short-term liabilities, thereby improving the capacity to meet immediate obligations. However, the volatility in cash assets warrants continuous monitoring to ensure consistency in liquidity strength.