Becton Dickinson and Company (BDX)

Days of sales outstanding (DSO)

		Sep 30, 2024	Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020
Receivables turnover		6.65	7.64	8.61	7.66	6.70
DSO	days	54.86	47.74	42.38	47.64	54.45

September 30, 2024 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 6.65
= 54.86

Based on the days of sales outstanding (DSO) data provided for Becton Dickinson and Company over the five-year period from September 30, 2020, to September 30, 2024, we can observe a fluctuating trend in the collection period for accounts receivable.

The DSO for Becton Dickinson and Company has shown variability during the period under review. In particular, we note that the DSO increased from 47.64 days in 2021 to 54.86 days in 2024, with a peak observed in the latest year. This indicates that the company took longer to collect its accounts receivable from customers in 2024 compared to prior years.

On the positive side, Becton Dickinson managed to reduce its DSO from 54.45 days in 2020 to 42.38 days in 2022, showcasing an efficient collections process and improved liquidity during that period. However, this positive trend was not sustained as the DSO increased again in the subsequent years.

The changes in DSO could be influenced by various factors such as changes in the company's credit policies, customer payment behaviors, economic conditions, and industry trends. A higher DSO may indicate potential issues with collections, credit risk, or customer payment delays, while a lower DSO reflects efficient accounts receivable management.

Overall, it is essential for Becton Dickinson and Company to closely monitor its DSO and strive for a balance between maintaining strong customer relationships and ensuring timely collections to optimize its cash flow and working capital management.