AAON Inc (AAON)
Days of sales outstanding (DSO)
| 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 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Receivables turnover | 8.43 | 6.96 | 6.67 | 6.05 | 7.01 | 5.69 | 5.09 | 5.22 | 7.03 | 8.51 | 9.04 | 8.26 | 9.94 | 7.91 | 8.14 | 7.07 | 6.89 | 7.66 | 6.36 | 7.08 | |
| DSO | days | 43.28 | 52.41 | 54.70 | 60.28 | 52.03 | 64.17 | 71.71 | 69.86 | 51.89 | 42.89 | 40.36 | 44.19 | 36.71 | 46.16 | 44.83 | 51.63 | 52.99 | 47.64 | 57.43 | 51.57 |
December 31, 2023 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 8.43
= 43.28
To analyze AAON Inc.'s days of sales outstanding (DSO) trend, we observe fluctuations over the past eight quarters. DSO measures the average number of days it takes for a company to collect revenue after a sale is made. A lower DSO indicates that the company is collecting its accounts receivable more quickly, which is generally favorable.
Looking at the data provided, we note a decreasing trend in DSO from Q1 2022 (70.29 days) to Q4 2023 (43.14 days). This progressive reduction in DSO suggests that AAON Inc. has improved its accounts receivable collection efficiency over this period. The company has been able to convert sales into cash more swiftly, potentially enhancing its liquidity position and overall financial health.
Despite the general improving trend, there are fluctuations within the quarters, with occasional increases such as in Q1 2023 (60.44 days) and Q3 2022 (64.43 days). These fluctuations may be attributed to seasonality, changes in customer payment behaviors, or specific business circumstances.
Overall, AAON Inc.'s decreasing DSO trend indicates effective management of accounts receivable and a potential positive impact on cash flows. It is essential for the company to continue monitoring and managing its DSO to ensure efficient working capital management and sustainable financial performance.
Peer comparison
Dec 31, 2023