Adapthealth Corp (AHCO)

Days of sales outstanding (DSO)

Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 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
Receivables turnover 7.18 7.41 6.63 6.76 6.72 7.21 7.32 7.52 7.20 5.57 5.34 4.87 4.36 4.59 4.13 3.50 3.60 4.92 4.97 4.10
DSO days 50.86 49.25 55.06 54.01 54.35 50.61 49.83 48.51 50.72 65.54 68.39 74.87 83.68 79.52 88.41 104.25 101.31 74.11 73.49 89.01

December 31, 2024 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 7.18
= 50.86

The Days Sales Outstanding (DSO) ratio for Adapthealth Corp reflects the average number of days it takes for the company to collect on its accounts receivable. From the data provided, we observe fluctuations in the DSO ratio over the years.

Initially, in March 2020, the DSO stood at 89.01 days, suggesting the company took nearly three months to collect its receivables. This figure decreased to 73.49 days by June 2020, indicating an improvement in collections efficiency. However, by December 2020, the DSO spiked to 101.31 days, indicating a potential slowdown in collections.

This trend of fluctuation continued over the following periods, with peaks in March 2021 (104.25 days) and December 2021 (83.68 days) and troughs in June 2022 (68.39 days) and September 2022 (65.54 days). It is worth noting that from December 2022 onwards, the DSO ratio showed a decreasing trend, reaching 50.86 days by December 2024.

A decreasing DSO ratio suggests that Adapthealth Corp is becoming more efficient in collecting its receivables, which could indicate improved cash flow and liquidity. However, management should continue monitoring and managing the collections process to ensure timely and efficient collections to maintain healthy cash flows and working capital levels.