Healthcare Services Group Inc (HCSG)
Days of sales outstanding (DSO)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Receivables turnover | 4.34 | 4.92 | 5.43 | 6.89 | 5.39 | |
| DSO | days | 84.08 | 74.13 | 67.18 | 52.97 | 67.73 |
December 31, 2023 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 4.34
= 84.08
The days of sales outstanding (DSO) for Healthcare Services Group, Inc. have shown fluctuations over the past five years. In 2023, the DSO increased to 83.75 days from 74.16 days in 2022, indicating that the company took longer to collect revenue from its customers compared to the previous year. This could potentially signify issues with accounts receivable management or a change in customer payment behaviors.
Comparing to 2021, where the DSO was 67.18 days, the increase in 2023 suggests a worsening trend in collecting payments from customers. However, compared to 2020, when the DSO was 52.97 days, the DSO has increased significantly over the past three years.
The DSO in 2019 was 67.60 days, which is relatively close to the DSO in 2023. This similarity indicates that the company's collections efficiency has not improved significantly over the past five years.
Overall, the trend of increasing DSO over the past few years for Healthcare Services Group, Inc. may imply potential challenges in managing accounts receivable effectively, which could impact the company's cash flow and liquidity. Further analysis into the reasons behind the increasing DSO would be beneficial to identify opportunities for improvement in the company's revenue collection processes.