Federal Signal Corporation (FSS)
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 | 9.25 | 7.81 | 8.10 | 7.78 | 8.26 | 7.91 | 7.63 | 8.09 | 8.92 | 8.57 | 8.03 | 8.24 | 8.90 | 7.93 | 9.41 | 8.72 | 9.10 | 8.32 | 7.86 | 7.99 | |
| DSO | days | 39.45 | 46.74 | 45.08 | 46.93 | 44.21 | 46.14 | 47.83 | 45.14 | 40.92 | 42.59 | 45.47 | 44.28 | 40.99 | 46.01 | 38.78 | 41.84 | 40.11 | 43.84 | 46.43 | 45.69 |
December 31, 2023 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 9.25
= 39.45
Days Sales Outstanding (DSO) is a measure of how long it takes a company to collect its accounts receivable. A lower DSO indicates that the company is collecting payments from customers more quickly.
Analyzing the trend of DSO for Federal Signal Corp. over the past eight quarters, we observe fluctuations in the DSO figures. In Q4 2023, the DSO was 39.45 days, which is a notable decrease compared to the previous quarter's figure of 46.74 days. This suggests that the company improved its efficiency in collecting payments from customers during the most recent quarter.
Looking further back, we can see that DSO has varied between a range of approximately 39 to 47 days over the past two years. This indicates some inconsistency in the company's accounts receivable management. While there have been quarters with lower DSO values, such as Q4 2023, there have also been quarters where DSO exceeded 46 days, indicating a longer collection period.
It is important for Federal Signal Corp. to closely monitor and manage its DSO to ensure timely collection of accounts receivable, as a high DSO can tie up cash flow and potentially indicate credit or collection issues with customers. Continued improvement in DSO, aiming for lower values closer to the lower end of the historical range, may signal enhanced efficiency in managing accounts receivable and contribute to the company's overall financial health.
Peer comparison
Dec 31, 2023