Hormel Foods Corporation (HRL)
Days of sales outstanding (DSO)
| Jan 28, 2024 | Oct 29, 2023 | Jul 30, 2023 | Apr 30, 2023 | Jan 29, 2023 | Oct 30, 2022 | Jul 31, 2022 | May 1, 2022 | Jan 30, 2022 | Oct 31, 2021 | Jul 25, 2021 | Apr 25, 2021 | Jan 24, 2021 | Oct 25, 2020 | Jul 26, 2020 | Apr 26, 2020 | Jan 26, 2020 | Oct 27, 2019 | Jul 28, 2019 | Apr 28, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Receivables turnover | 16.06 | 14.60 | 15.27 | 15.86 | 15.51 | 14.17 | 15.50 | — | 14.52 | 12.54 | 11.31 | 13.46 | 13.51 | 12.90 | 14.90 | 17.88 | 16.90 | 15.95 | 17.96 | 17.79 | |
| DSO | days | 22.73 | 25.00 | 23.90 | 23.02 | 23.53 | 25.76 | 23.54 | — | 25.13 | 29.10 | 32.26 | 27.11 | 27.02 | 28.30 | 24.50 | 20.42 | 21.60 | 22.88 | 20.32 | 20.51 |
January 28, 2024 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 16.06
= 22.73
To analyze Hormel Foods Corp.'s Days of Sales Outstanding (DSO), we will examine the trend of DSO over the last eight quarters. DSO indicates how long it takes for a company to collect revenue after a sale is made. A lower DSO value is generally preferred as it signifies more efficient collection of accounts receivable.
Looking at the data provided, we observe that the DSO has fluctuated over the quarters, with some variability in collection efficiency. In Q1 2024, the DSO decreased to 22.59 days from 24.85 days in Q4 2023, indicating improved efficiency in collecting revenue. This downward trend in DSO suggests that Hormel Foods Corp. has been managing its accounts receivable more effectively in recent quarters.
Comparing the most recent DSO value to the values from the same quarter in previous years, we see that the current DSO of 22.59 days is relatively lower than the DSO figures for the corresponding quarters in the last few years. This suggests that the company has been able to accelerate its collection of accounts receivable compared to previous periods.
Overall, the downward trend in DSO and the lower DSO value in the most recent quarter indicate that Hormel Foods Corp. has been improving its collection efficiency and managing its receivables effectively. This can be a positive sign of strong financial management and liquidity for the company.