Chipotle Mexican Grill Inc (CMG)

Days of sales outstanding (DSO)

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Receivables turnover		53.57	58.59	55.84	38.97	15.45
DSO	days	6.81	6.23	6.54	9.37	23.62

December 31, 2024 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 53.57
= 6.81

Chipotle Mexican Grill Inc has consistently improved its Days of Sales Outstanding (DSO) metric over the past few years. As of December 31, 2020, the company had a DSO of 23.62 days, indicating that on average, it took around 23.62 days to collect revenue from its customers.

By December 31, 2021, Chipotle had significantly reduced its DSO to 9.37 days, showcasing more efficient collection of sales proceeds. This trend continued into the following years, with the DSO further decreasing to 6.54 days by December 31, 2022, 6.23 days by December 31, 2023, and then slightly increasing to 6.81 days by December 31, 2024.

The declining trend in DSO reflects the company's effective management of receivables and improved cash flow efficiency. This indicates that Chipotle has been successful in accelerating the collection of cash from its credit sales, which is a positive sign of liquidity and financial health. Overall, the decreasing DSO highlights Chipotle's focus on optimizing working capital management and enhancing operational efficiency.