Cogent Communications Group Inc (CCOI)
Days of sales outstanding (DSO)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Receivables turnover | 6.16 | 12.77 | 13.24 | 10.66 | 12.15 | |
| DSO | days | 59.30 | 28.59 | 27.57 | 34.25 | 30.03 |
December 31, 2023 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 6.16
= 59.30
Based on the data provided, the Days of Sales Outstanding (DSO) for Cogent Communications Holdings Inc have shown a noticeable increase over the past five years. The DSO increased from 27.06 days in 2019 to 52.55 days in 2023. This upward trend indicates that, on average, it now takes the company longer to collect its accounts receivable.
The DSO was relatively stable between 2019 and 2021, ranging from 25.95 days to 28.39 days. However, a significant spike was observed in 2022 and 2023, with DSO more than doubling from 26.86 days to 52.55 days. This suggests a potential issue with the company's credit policies or its ability to collect payments from customers in a timely manner.
A higher DSO can lead to cash flow challenges as funds are tied up in accounts receivable for a longer period. It may also indicate potential credit risks associated with customers not paying their invoices promptly. The management should closely monitor and address the reasons behind the increasing DSO to ensure the company's liquidity and overall financial health.
Peer comparison
Dec 31, 2023