Medpace Holdings Inc (MEDP)

Days of sales outstanding (DSO)

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Receivables turnover		7.11	6.31	6.00	6.14	5.76
DSO	days	51.32	57.81	60.88	59.42	63.42

December 31, 2024 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 7.11
= 51.32

The Days Sales Outstanding (DSO) is a crucial metric that indicates the average number of days it takes for a company to collect its accounts receivable. In the case of Medpace Holdings Inc, the DSO has shown a declining trend over the past five years, decreasing from 63.42 days as of December 31, 2020, to 51.32 days as of December 31, 2024.

A decreasing DSO generally suggests that the company is improving its efficiency in collecting receivables, which can be indicative of effective credit management practices or a more streamlined accounts receivable process. A lower DSO implies that the company is able to convert its credit sales into cash more quickly.

For Medpace Holdings Inc, the decreasing trend in DSO may indicate that the company is becoming more efficient in managing its accounts receivable and collecting payments from customers, which can lead to improved cash flows and financial performance. It's essential for investors and stakeholders to continue monitoring this metric to ensure that the trend remains favorable and aligns with the company's overall financial health and operational efficiency.