Cintas Corporation (CTAS)
Days of sales outstanding (DSO)
| May 31, 2024 | May 31, 2023 | May 31, 2022 | May 31, 2021 | May 31, 2020 | ||
|---|---|---|---|---|---|---|
| Receivables turnover | 7.71 | 7.55 | 7.57 | 7.62 | 8.14 | |
| DSO | days | 47.32 | 48.34 | 48.24 | 47.90 | 44.84 |
May 31, 2024 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 7.71
= 47.32
The Days Sales Outstanding (DSO) ratio for Cintas Corporation has been relatively stable over the past five years, ranging from 44.84 days in 2020 to 48.34 days in 2023. In the most recent fiscal year ending on May 31, 2024, the DSO decreased slightly to 47.32 days. This indicates that, on average, the company takes around 47 days to collect its accounts receivable.
A lower DSO generally suggests that the company is efficient in collecting payments from its customers, while a higher DSO may indicate potential issues with accounts receivable management or credit policies. Cintas' consistent DSO level over the years suggests a good balance in managing its accounts receivable effectively.
It is important for the company to monitor its DSO ratio regularly to ensure timely collection of receivables and maintain healthy cash flows. Additionally, comparing the DSO ratio with industry benchmarks can provide insights into the company's performance relative to its peers in terms of credit management and collection efficiency.
Peer comparison
May 31, 2024