Costco Wholesale Corp (COST)

Days of sales outstanding (DSO)

		Feb 18, 2024	Nov 26, 2023	Sep 3, 2023	May 7, 2023	Feb 12, 2023	Nov 20, 2022	Aug 28, 2022	May 8, 2022	Feb 13, 2022	Nov 21, 2021	Aug 29, 2021	May 9, 2021	Feb 14, 2021	Nov 22, 2020	Aug 30, 2020	May 10, 2020	Feb 16, 2020	Nov 24, 2019	Sep 1, 2019	May 12, 2019
Receivables turnover		89.54	96.64	106.04	94.10	86.36	99.93	101.27	109.26	94.18	105.12	108.67	117.01	92.36	105.06	107.59	106.75	79.65	90.40	99.48	87.80
DSO	days	4.08	3.78	3.44	3.88	4.23	3.65	3.60	3.34	3.88	3.47	3.36	3.12	3.95	3.47	3.39	3.42	4.58	4.04	3.67	4.16

February 18, 2024 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 89.54
= 4.08

Days of Sales Outstanding (DSO) is a financial ratio that measures the average number of days a company takes to collect revenue after a sale has been made. A lower DSO indicates that the company is collecting payments faster, which is a positive sign of efficiency in managing accounts receivable.

Analyzing Costco Wholesale Corp's historical DSO data from the provided table, we observe some fluctuations over time. In recent quarters, the DSO has been relatively stable, ranging between 3.34 to 4.23 days. This indicates that Costco has been efficient in collecting payments from customers within a short period after making sales.

The lowest DSO of 3.12 days was reported in the first quarter of 2021 (Feb 14, 2021), suggesting an exceptionally efficient collection process during that period. On the other hand, the highest DSO of 4.58 days was recorded in the first quarter of 2020 (Feb 16, 2020), indicating a slight delay in collecting payments compared to other quarters.

Overall, Costco's DSO trend reflects a consistent effort in managing accounts receivable effectively, maintaining a relatively low DSO level which signifies prompt collection of sales revenues. This efficiency in collecting payments from customers contributes to the company's strong financial performance and liquidity position.