Dominion Energy Inc (D)
Days of sales outstanding (DSO)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Receivables turnover | 4.10 | 3.13 | 4.17 | 3.93 | 4.07 | |
| DSO | days | 88.99 | 116.72 | 87.49 | 92.90 | 89.75 |
December 31, 2023 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 4.10
= 88.99
Days Sales Outstanding (DSO) is a measure of how long, on average, it takes for a company to collect revenue after making a sale. A lower DSO indicates that the company is collecting its receivables more quickly, which is generally considered favorable.
Analyzing Dominion Energy Inc's DSO over the past five years, we observe fluctuations in the metric. In 2019, the DSO was at its lowest point at 58.26 days, indicating efficient collection of sales revenue. However, in the following years, DSO increased, reaching a peak of 71.35 days in 2022 before declining to 63.63 days in 2023.
The increase in DSO from 2019 to 2022 may raise concerns about the company's accounts receivable management and its ability to collect revenue promptly. However, the drop in DSO in 2023 suggests an improvement in the collection process.
It is crucial for Dominion Energy Inc to closely monitor its DSO and strive to keep it at optimal levels to ensure efficient cash flow management and liquidity. Further analysis of the underlying factors driving changes in DSO over time would be beneficial to identify areas for improvement in the company's accounts receivable processes.
Peer comparison
Dec 31, 2023