Cummins Inc (CMI)
Days of sales outstanding (DSO)
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Receivables turnover | 281.83 | — | — | — | 420.56 | — | — | 64.27 | 61.16 | 74.94 | 86.37 | 60.94 | 45.67 | — | — | — | 4.96 | 58.04 | 54.33 | 83.31 | |
| DSO | days | 1.30 | — | — | — | 0.87 | — | — | 5.68 | 5.97 | 4.87 | 4.23 | 5.99 | 7.99 | — | — | — | 73.55 | 6.29 | 6.72 | 4.38 |
December 31, 2024 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 281.83
= 1.30
Days Sales Outstanding (DSO) is a measure that indicates the average number of days it takes for a company to collect revenue after a sale has been made. For Cummins Inc, the DSO trend over the past few years shows some fluctuations.
As of March 31, 2020, the DSO was at 4.38 days, indicating a quick collection of receivables. However, by December 31, 2020, the DSO had increased significantly to 73.55 days, suggesting a slower collection process during that period. This sudden increase may raise concerns about the efficiency of Cummins' accounts receivable management.
Subsequently, the DSO improved to 7.99 days by the end of December 31, 2021. This reduction signifies that Cummins was able to enhance its collection efforts and shorten the time it takes to convert sales into cash.
In the following periods, the DSO continued to fluctuate, ranging from 0.87 days on December 31, 2023, to 5.99 days on March 31, 2022. The lower DSO figures indicate that Cummins has been efficient in collecting payments from customers.
Overall, while there have been fluctuations in Cummins Inc's DSO over the years, the trend appears to show a reasonably effective management of accounts receivable and improvement in the collection process, leading to quicker conversion of sales into cash.
Peer comparison
Dec 31, 2024
See also:
Cummins Inc Average Receivable Collection Period (Quarterly Data)