Federal Signal Corporation (FSS)
Days of sales outstanding (DSO)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Receivables turnover | 9.25 | 8.26 | 8.92 | 8.90 | 9.10 | |
| DSO | days | 39.45 | 44.21 | 40.92 | 40.99 | 40.11 |
December 31, 2023 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 9.25
= 39.45
Days Sales Outstanding (DSO) is a financial ratio that measures the average number of days a company takes to collect revenue after a sale has been made. It is calculated by dividing accounts receivable by average daily sales.
Analyzing Federal Signal Corp.'s DSO over the past five years, we can see a slight fluctuation in the metric. In 2023, the DSO decreased to 39.45 days from 44.21 days in 2022, indicating that the company has been able to collect revenue more efficiently. This may suggest improved credit management or faster customer payments.
Comparing to the previous years, the DSO in 2021 was 40.92 days, which was relatively consistent with 2020 and 2019. This stability may indicate that the company has maintained a consistent collection process over these years.
Overall, the decreasing trend in DSO from 2022 to 2023 is a positive indicator of Federal Signal Corp.'s ability to efficiently collect revenue from its customers. This improvement in DSO could potentially lead to better cash flow management and working capital efficiency for the company.
Peer comparison
Dec 31, 2023