DXP Enterprises Inc (DXPE)
Days of sales outstanding (DSO)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Receivables turnover | 5.22 | 4.49 | 4.80 | — | 6.63 | |
| DSO | days | 69.91 | 81.31 | 76.09 | — | 55.04 |
December 31, 2023 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 5.22
= 69.91
The days of sales outstanding (DSO) metric for DXP Enterprises Inc has shown variability over the past five years, suggesting fluctuations in the company's account receivables management.
In 2019, the DSO was 55.04 days, indicating that, on average, it took approximately 55 days for the company to collect its accounts receivable. This number increased to 76.09 days in 2021 before decreasing to 69.91 days in 2023. The increase in DSO from 2019 to 2021 suggests a potential inefficiency in collecting receivables or a shift in the company's sales mix towards longer payment terms. However, the decrease in 2023 indicates an improvement in receivables management efficiency.
It is essential for DXP Enterprises Inc to monitor its DSO closely as a high DSO can tie up valuable cash flow and indicate potential credit risk with customers. By analyzing trends in DSO over time, the company can identify areas for improvement in its account receivables management processes.
Peer comparison
Dec 31, 2023