Advance Auto Parts Inc (AAP)
Days of sales outstanding (DSO)
| Dec 31, 2023 | Oct 7, 2023 | Jul 15, 2023 | Apr 22, 2023 | Dec 31, 2022 | Oct 8, 2022 | Apr 23, 2022 | Dec 31, 2021 | Oct 9, 2021 | Jul 17, 2021 | Apr 24, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jul 11, 2020 | Apr 18, 2020 | Dec 31, 2019 | Oct 5, 2019 | Jul 13, 2019 | Apr 20, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Receivables turnover | 14.10 | 13.00 | 14.13 | 15.21 | 15.89 | 13.04 | 11.52 | 14.05 | 11.76 | 13.53 | 13.33 | 13.47 | 11.69 | 12.96 | 15.07 | 14.08 | 13.45 | 13.55 | 14.11 | 15.33 | |
| DSO | days | 25.88 | 28.07 | 25.84 | 24.00 | 22.96 | 28.00 | 31.69 | 25.98 | 31.03 | 26.97 | 27.37 | 27.11 | 31.23 | 28.15 | 24.22 | 25.92 | 27.14 | 26.93 | 25.86 | 23.81 |
December 31, 2023 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 14.10
= 25.88
Days Sales Outstanding (DSO) is a measure used to evaluate how efficiently a company is managing its accounts receivable. It indicates the average number of days it takes for a company to collect payment from its customers after a sale is made. A lower DSO typically signifies faster collections and better cash flow management.
Analyzing Advance Auto Parts Inc's DSO over the past five years, we can observe fluctuations in the metric. As of December 31, 2023, the DSO stands at 25.88 days, which is relatively consistent with previous periods. The company has maintained a generally stable DSO trend, with occasional variations seen in some quarters.
Looking back, the DSO was at its lowest at 22.96 days on December 31, 2022, indicating efficient collections and cash conversion. On the other hand, there were spikes in DSO, such as the peak of 31.69 days on April 23, 2022, and 31.23 days on December 31, 2020, suggesting potential issues with collections efficiency during those periods.
Overall, Advance Auto Parts Inc's DSO seems to have been managed reasonably well, staying within a reasonable range over time. However, it is essential for the company to continue monitoring and optimizing its accounts receivable processes to ensure timely collections and improved working capital efficiency.
Peer comparison
Dec 31, 2023