Alamo Group Inc (ALG)
Days of sales outstanding (DSO)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Receivables turnover | 4.67 | 4.75 | 5.57 | 5.40 | 4.46 | |
| DSO | days | 78.21 | 76.80 | 65.56 | 67.59 | 81.78 |
December 31, 2023 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 4.67
= 78.21
To analyze Alamo Group Inc.'s Days Sales Outstanding (DSO) trend, we observe that the DSO has fluctuated over the past five years. The DSO stood at 78.21 days at the end of 2023, compared to 76.80 days in 2022, indicating a slight increase in the number of days it takes to collect sales revenue from customers.
In 2021, the DSO was notably lower at 65.56 days, suggesting an improvement in the efficiency of the company's accounts receivable collection process. This was a positive trend compared to 2020, where the DSO was slightly higher at 67.59 days.
Further back in 2019, the DSO was at its highest level within the past five years, reaching 81.78 days. This indicated a longer period required to convert credit sales into cash, highlighting potential inefficiencies in the company's accounts receivable management.
Overall, while there have been fluctuations in Alamo Group Inc.'s DSO over the past five years, management should aim to continue monitoring and potentially implementing strategies to improve the efficiency of their accounts receivable collection process in order to optimize cash flow and working capital management.
Peer comparison
Dec 31, 2023