HealthStream Inc (HSTM)

Days of sales outstanding (DSO)

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Receivables turnover		7.26	6.25	7.35	5.31	8.37
DSO	days	50.29	58.42	49.65	68.73	43.63

December 31, 2023 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 7.26
= 50.29

Healthstream Inc's days of sales outstanding (DSO) measures the average number of days it takes for the company to collect revenue after making a sale. A lower DSO indicates that the company is collecting payments more quickly, which is generally favorable as it improves cash flow and liquidity.

Analyzing Healthstream Inc's DSO over the past five years, we observe fluctuations in the metric. In 2019, the DSO was relatively low at 43.63 days, indicating efficient collections. However, there was an increase in DSO in 2020 to 68.73 days, suggesting a potential delay in collecting revenue during that period.

The DSO decreased in 2021 to 49.65 days, showing an improvement in collections efficiency. This trend continued in 2022 with a DSO of 58.42 days, although it was slightly higher compared to 2021. In 2023, the DSO further decreased to 50.29 days, indicating a positive trend in collecting revenue more promptly compared to the previous year.

Overall, while there have been fluctuations in Healthstream Inc's DSO over the past five years, the trend towards lower DSO values in recent years is a positive indicator of the company's ability to manage receivables efficiently and collect payments in a timely manner.