Amgen Inc (AMGN)
Days of sales outstanding (DSO)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Receivables turnover | 3.22 | 8.02 | 8.70 | 4.78 | 5.02 | |
| DSO | days | 113.38 | 45.50 | 41.95 | 76.43 | 72.68 |
December 31, 2023 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 3.22
= 113.38
The days of sales outstanding (DSO) is a measure used to assess how efficiently a company manages its accounts receivable. It indicates the average number of days it takes for a company to collect payment from its customers after making a sale.
For AMGEN Inc., we observe the following trend in DSO over the past five years:
- Dec 31, 2019: DSO was 63.39 days
- Dec 31, 2020: DSO increased to 68.06 days
- Dec 31, 2021: DSO further increased to 71.08 days
- Dec 31, 2022: DSO rose to 78.93 days
- Dec 31, 2023: DSO reached 96.33 days
The increasing trend in DSO over the past five years for AMGEN Inc. indicates a potential deterioration in the efficiency of the company's accounts receivable management. A higher DSO value suggests that it is taking the company longer to collect payments from its customers, which could impact its cash flow and working capital management.
It is important for AMGEN Inc. to closely monitor its DSO and implement strategies to improve collection processes, such as offering discounts for early payment, enhancing credit policies, or conducting regular reviews of aging accounts receivable. By effectively managing its DSO, AMGEN Inc. can optimize its cash flow and enhance its overall financial performance.
Peer comparison
Dec 31, 2023