Henry Schein Inc (HSIC)
Days of sales outstanding (DSO)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Receivables turnover | 6.58 | 8.74 | 8.53 | 7.07 | 8.17 | |
| DSO | days | 55.50 | 41.76 | 42.79 | 51.59 | 44.66 |
December 31, 2023 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 6.58
= 55.50
The Days Sales Outstanding (DSO) ratio measures the average number of days that a company takes to collect revenue after a sale is made. A lower DSO indicates that a company is collecting its accounts receivable more efficiently.
Analyzing the DSO trend for Henry Schein Inc over the past five years, we observe fluctuations in the collection efficiency. In 2019, the DSO was 44.66 days, which decreased to 51.59 days in 2020 before decreasing again to 42.79 days in 2021. However, there was an increase in DSO to 41.76 days in 2022, followed by a significant increase to 55.50 days in 2023.
The increase in DSO in 2023 compared to the previous year suggests that Henry Schein Inc may be experiencing challenges in collecting its accounts receivable promptly. This could potentially indicate issues with credit policies, customer payment behaviors, or changes in the company's industry dynamics.
It is important for the company to closely monitor and manage its DSO to ensure efficient cash flow and liquidity. Analyzing the underlying reasons for the increase in DSO can help Henry Schein Inc implement strategies to improve its accounts receivable management and overall financial health.
Peer comparison
Dec 31, 2023