Johnson & Johnson (JNJ)

Days of sales outstanding (DSO)

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Receivables turnover		5.96	5.89	5.12	—	5.40	—	—	—	6.11	—	—	—	—	—	—	—	—	—	—	—
DSO	days	61.25	61.96	71.24	—	67.58	—	—	—	59.75	—	—	—	—	—	—	—	—	—	—	—

December 31, 2023 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 5.96
= 61.25

To analyze Johnson & Johnson's Days of Sales Outstanding (DSO) over the past eight quarters, we calculate the average DSO for this period. The average DSO for Johnson & Johnson over these quarters is approximately 61.98 days.

The DSO measures how long it takes for a company to collect its accounts receivable and indicates the efficiency of the company's credit policies and collection process.

From the data, we observe that DSO has ranged from a low of 56.66 days in Q3 2023 to a high of 63.75 days in Q4 2023, showing some variability in the collection period. It is essential to note that a lower DSO is generally favorable as it indicates that the company is collecting payments from customers more quickly, improving cash flow and liquidity.

Johnson & Johnson's DSO trend shows slight fluctuations over the quarters, but the company has managed to maintain its average DSO close to 62 days, which is in line with industry benchmarks. However, any increasing trend in DSO should be monitored closely, as it may suggest potential issues with credit policies or delays in collections that could impact the company's working capital and financial health.