Grand Canyon Education Inc (LOPE)

Days of sales outstanding (DSO)

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Receivables turnover		11.96	10.63	11.94	13.17	14.97
DSO	days	30.51	34.35	30.56	27.72	24.37

December 31, 2023 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 11.96
= 30.51

Days Sales Outstanding (DSO) is a measure of how long it takes for a company to collect its accounts receivable. A lower DSO indicates that the company is collecting payments from customers faster, which is generally better for cash flow and liquidity.

Analyzing the DSO trend for Grand Canyon Education Inc over the past five years, we observe that there has been some fluctuation. In 2019, the DSO was the lowest at 26.31 days, indicating efficient collections from customers. However, in the following years, the DSO increased, reaching its peak in 2022 at 32.12 days before slightly decreasing to 30.44 days in 2023.

The increase in DSO from 2019 to 2022 suggests that Grand Canyon Education Inc may be facing challenges in collecting payments from customers within a reasonable timeframe. This could potentially impact the company's cash flows and liquidity position. The slight improvement in DSO in 2023 is a positive sign, indicating some progress in collections efficiency.

It is essential for the company to closely monitor its accounts receivable management practices to ensure timely collection of payments and maintain healthy cash flow levels. By efficiently managing its DSO, Grand Canyon Education Inc can enhance its financial stability and operational performance in the long run.