Emerson Electric Company (EMR)

Days of sales outstanding (DSO)

		Sep 30, 2024	Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020
Receivables turnover		5.06	4.91	5.71	6.15	5.99
DSO	days	72.14	74.30	63.91	59.36	60.93

September 30, 2024 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 5.06
= 72.14

Emerson Electric Company’s Days Sales Outstanding (DSO) has shown a fluctuating trend over the past five years. The DSO increased from 60.93 days in 2020 to 74.30 days in 2023, indicating a deterioration in the company's accounts receivable collection efficiency. However, in 2024, there was a significant improvement as the DSO decreased to 72.14 days.

On average, Emerson Electric Company takes approximately 66.13 days to collect its accounts receivable, which suggests that the company might have a moderate level of efficiency in converting its sales into cash. It is important for the company to closely monitor and manage its accounts receivable to maintain healthy cash flow and working capital levels. Further analysis of the underlying reasons for the fluctuations in DSO over the years could provide insights into the company's overall financial health and operational efficiency.