Frontdoor Inc (FTDR)
Days of sales outstanding (DSO)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Receivables turnover | 296.67 | 332.40 | 228.86 | 294.80 | 124.09 | |
| DSO | days | 1.23 | 1.10 | 1.59 | 1.24 | 2.94 |
December 31, 2023 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 296.67
= 1.23
Frontdoor Inc.'s Days Sales Outstanding (DSO) measures the average number of days it takes the company to collect revenue after a sale is made. A lower DSO indicates that the company is collecting payments more quickly, which is generally considered favorable as it improves cash flow and liquidity.
Over the past five years, Frontdoor Inc.'s DSO has shown fluctuations. In 2023, the DSO improved to 1.23 days compared to 1.10 days in 2022, indicating a slightly slower collection of revenue. However, this figure is still relatively low, suggesting that the company is efficient in collecting payments from customers.
In 2021, the DSO increased to 1.59 days from 1.24 days in 2020. This uptick could be a signal that the company faced challenges in collecting payments promptly that year. However, the DSO remained relatively low compared to historical data.
The significant increase in DSO to 2.94 days in 2019 may have raised concerns about the company's efficiency in collecting revenue. This spike could indicate potential issues with accounts receivable management or changes in the payment behavior of customers.
Overall, Frontdoor Inc. has generally maintained a low DSO, reflecting efficient accounts receivable management. Investors and stakeholders may continue to monitor changes in DSO to assess the company's ability to collect revenue timely and manage cash flow effectively.
Peer comparison
Dec 31, 2023