Builders FirstSource Inc (BLDR)

Days of sales outstanding (DSO)

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Receivables turnover		9.90	13.49	10.13	8.94	10.50
DSO	days	36.88	27.06	36.04	40.83	34.76

December 31, 2023 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 9.90
= 36.88

Builders Firstsource Inc's Days Sales Outstanding (DSO) measures the average number of days it takes for the company to collect payment after making a sale. A lower DSO indicates better efficiency in collecting receivables.

Looking at the trend over the past five years, we observe fluctuations in DSO. In 2023, the DSO increased to 36.87 days from 27.03 days in 2022, signaling a potential delay in collecting payments from customers compared to the previous year.

In 2021, the DSO was 36.03 days, slightly lower than in 2023, but higher than the DSO in 2019 and 2022. This implies that the company took slightly longer to collect payments in 2021 than in 2022.

The highest DSO was recorded in 2020 at 40.79 days, reflecting a significant delay in collecting payments, possibly due to changes in credit policies or economic conditions.

On the other hand, the lowest DSO in the past five years was in 2019 at 34.71 days, suggesting improved efficiency in collecting receivables compared to the subsequent years.

Overall, the fluctuation in DSO over the years indicates varying effectiveness in managing accounts receivable and highlights the importance of monitoring and improving collections processes to maintain healthy cash flow and financial stability.