Dayforce Inc. (DAY)

Days of sales outstanding (DSO)

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Receivables turnover		6.46	6.75	6.81	7.99	9.80
DSO	days	56.52	54.10	53.56	45.71	37.25

December 31, 2023 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 6.46
= 56.52

Looking at the days of sales outstanding (DSO) trend of Dayforce Inc. over the past five years, we observe a consistent increase in the time it takes the company to collect its accounts receivable.

In 2019, the DSO was at its lowest point at 37.25 days, indicating that the company was able to collect its outstanding sales relatively quickly. However, since then, the DSO has steadily increased each year, reaching 56.52 days by the end of 2023.

This upward trend in DSO suggests that Dayforce Inc. may be facing challenges in collecting payments from its customers promptly. A higher DSO can indicate potential issues with credit policies, customer payment issues, or changes in customer behavior that are causing delays in accounts receivable turnover.

It is important for Dayforce Inc. to closely monitor and manage its DSO to ensure efficient cash flow management and timely collection of outstanding receivables. This analysis highlights the need for the company to assess its credit and collection processes to maintain financial health and liquidity.