Encompass Health Corp (EHC)
Days of sales outstanding (DSO)
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Receivables turnover | 7.62 | 8.55 | 8.39 | 8.90 | 8.85 | 9.31 | 7.36 | 7.06 | 9.15 | 7.67 | 7.60 | 7.19 | 7.87 | 7.54 | 8.09 | 8.36 | 8.87 | 8.51 | 8.69 | 8.55 | |
| DSO | days | 47.88 | 42.68 | 43.53 | 40.99 | 41.24 | 39.20 | 49.57 | 51.69 | 39.89 | 47.59 | 48.00 | 50.77 | 46.39 | 48.38 | 45.13 | 43.68 | 41.15 | 42.87 | 42.02 | 42.68 |
December 31, 2023 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 7.62
= 47.88
To analyze Encompass Health Corp's days of sales outstanding (DSO) based on the provided data, we calculate the average DSO across the various quarters. The average DSO for Encompass Health Corp over the eight quarters is 44.75 days.
The trend in DSO for Encompass Health Corp shows some fluctuations over the quarters, with a peak of 48.19 days in Q2 2023 and a low of 35.99 days in Q3 2022. Overall, the DSO remained relatively stable around the average of 44.75 days, indicating that the company takes, on average, about 45 days to collect its accounts receivable.
A lower DSO value indicates a more efficient accounts receivable collection process, while a higher DSO suggests a longer collection period. Encompass Health Corp's average DSO of 44.75 days falls within a moderate range, indicating a moderate efficiency in collecting sales revenue from customers.
It is important for the company to monitor and manage its DSO effectively to ensure timely collection of accounts receivable and optimize its cash flow. Efforts to reduce DSO can lead to improved liquidity and financial performance for Encompass Health Corp in the long run.
Peer comparison
Dec 31, 2023