Entergy Corporation (ETR)

Days of sales outstanding (DSO)

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2019	Dec 31, 2018
Receivables turnover		8.20	8.52	8.45	8.37	9.21
DSO	days	44.53	42.84	43.22	43.61	39.62

December 31, 2023 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 8.20
= 44.53

Days Sales Outstanding (DSO) is a financial ratio that measures the average number of days it takes for a company to collect revenue after making a sale. A lower DSO typically indicates that a company is collecting payments from customers more quickly, which can improve cash flow and overall liquidity.

Analyzing the trend in Entergy Corp.'s DSO over the past five years, we observe fluctuations in the collection period. In 2019, the DSO stood at 40.55 days, increasing to 46.40 days in 2020, before decreasing to 42.59 days in 2021. However, in 2022, there was a further improvement to 39.65 days, and by the end of 2023, the DSO increased slightly to 41.87 days.

The movement in DSO suggests that Entergy Corp. may have experienced variations in its collection efficiency over the years. It is crucial to monitor DSO as an increase could potentially indicate challenges in collecting payments promptly from customers, leading to a strain on working capital. Conversely, a decrease in DSO could signify improved collection practices and effectiveness in managing accounts receivable.

Further analysis and comparison with industry benchmarks would be helpful in determining the efficiency of Entergy Corp.'s accounts receivable management and identifying areas for potential improvement in working capital management.