Molina Healthcare Inc (MOH)

Days of sales outstanding (DSO)

Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Receivables turnover 12.32 10.98 13.89 12.76 11.62
DSO days 29.62 33.25 26.28 28.61 31.42

December 31, 2024 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 12.32
= 29.62

Molina Healthcare Inc's Days Sales Outstanding (DSO) has shown a decreasing trend over the past five years, indicating an improvement in the efficiency of its accounts receivable collection process.

As of December 31, 2020, the company had a DSO of 31.42 days, which decreased to 28.61 days by December 31, 2021, and further reduced to 26.28 days by December 31, 2022. This downward trend suggests that Molina Healthcare Inc has been successful in accelerating its collection of receivables, potentially improving its cash flow and overall liquidity position.

However, there was a slight increase in DSO to 33.25 days by December 31, 2023, followed by a decrease to 29.62 days by December 31, 2024. Despite the fluctuation in 2023, the overall trend remains positive, indicating that the company has been effective in managing its accounts receivable efficiently.

Overall, the consistent decrease in DSO over the years reflects Molina Healthcare Inc's ability to promptly convert its credit sales into cash, which is a positive sign of its financial health and operational effectiveness.