Allegro Microsystems Inc (ALGM)

Days of sales outstanding (DSO)

		Mar 31, 2024	Mar 31, 2023	Mar 31, 2022	Mar 31, 2021
Receivables turnover		8.81	6.86	6.70	6.20
DSO	days	41.45	53.23	54.47	58.83

March 31, 2024 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 8.81
= 41.45

The Days Sales Outstanding (DSO) ratio for Allegro Microsystems Inc has shown a decreasing trend over the past four years. The ratio decreased from 58.83 days as of Mar 31, 2021, to 41.45 days as of Mar 31, 2024. This trend indicates that the company has been able to collect its accounts receivable more efficiently over the years.

A lower DSO value suggests that Allegro Microsystems Inc is able to collect payments from its customers more quickly, which can improve the company's cash flow position. It also signifies that the company's credit and collection policies are effective in managing its receivables.

The decreasing trend in DSO could be attributed to improvements in the company's collection processes, tighter credit policies, or better customer relationships. Overall, a declining DSO ratio is a positive sign of the company's ability to convert its sales into cash efficiently, which is essential for the company's financial health and sustainability.