Estee Lauder Companies Inc (EL)

Days of sales outstanding (DSO)

		Jun 30, 2024	Mar 31, 2024	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
Receivables turnover		8.86	8.09	8.48	7.99	10.82	8.26	8.39	7.94	10.78	8.11	8.43	7.44	9.42	8.40	7.14	7.98	12.40	8.65	7.38	6.63
DSO	days	41.19	45.10	43.05	45.70	33.75	44.20	43.50	45.98	33.87	44.99	43.29	49.06	38.77	43.46	51.15	45.77	29.44	42.21	49.44	55.08

June 30, 2024 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 8.86
= 41.19

Days Sales Outstanding (DSO) is a crucial metric that measures how long it takes for a company to collect its accounts receivable. A lower DSO indicates quicker collection of receivables, which is beneficial for cash flow management.

Analyzing Estee Lauder Companies Inc's DSO over the past several quarters, we observe fluctuations in the metric. For the most recent quarter ending on June 30, 2024, the DSO stood at 41.19 days, showing an improvement compared to the previous quarter's 45.10 days. This reduction may suggest that the company has been more efficient in collecting its outstanding receivables.

Looking back over the historical trend, we notice variations in DSO values, with some quarters showing lower numbers like 29.44 days in September 2020 and 33.75 days in June 2023, indicating effective accounts receivable management during those periods. Conversely, there were quarters with higher DSO figures, such as 55.08 days in September 2019 and 51.15 days in March 2021, which could imply delays or challenges in the collection process.

It is essential for Estee Lauder Companies Inc to monitor its DSO closely and strive for consistency or further improvements in this metric to ensure smooth cash flow operations. A well-managed DSO can enhance liquidity, reduce the risk of bad debts, and optimize working capital utilization.