MP Materials Corp (MP)
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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Receivables turnover | 8.43 | 16.99 | 24.10 | 19.61 | 14.97 | 26.77 | 13.74 | 11.81 | 6.51 | 7.41 | 26.45 | 12.39 | 36.90 | ||||
| DSO | days | 43.28 | 21.49 | 15.14 | 18.62 | 24.38 | 13.63 | 26.56 | 30.91 | 56.09 | 49.23 | 13.80 | 29.47 | 9.89 |
December 31, 2023 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 8.43
= 43.28
To analyze the Days of Sales Outstanding (DSO) for MP Materials Corporation based on the provided data, we can observe the trend over the last eight quarters:
1. Q4 2023 DSO: 14.44 days
2. Q3 2023 DSO: 20.68 days
3. Q2 2023 DSO: 14.73 days
4. Q1 2023 DSO: 18.35 days
5. Q4 2022 DSO: 24.26 days
6. Q3 2022 DSO: 13.60 days
7. Q2 2022 DSO: 26.56 days
8. Q1 2022 DSO: 30.91 days
The DSO represents the average number of days it takes for a company to collect payment after making a sale. A lower DSO indicates faster collection of accounts receivable, which is generally favorable as it signifies efficient cash flow management.
Analyzing the trend, we observe fluctuations in the DSO over the quarters. In Q3 2022, there was a notable decrease to 13.60 days, indicating efficient collection processes. However, DSO increased in subsequent quarters, reaching a peak of 30.91 days in Q1 2022, which may suggest potential issues with accounts receivable management.
In Q4 2022, there was a decrease in DSO to 24.26 days, followed by further improvements in Q1 and Q2 2023. The DSO decreased to 14.44 days in Q4 2023, reflecting a positive trend towards faster collection of receivables.
Overall, MP Materials Corporation has shown variability in its DSO over the analyzed period. It is essential for the company to continue monitoring and managing its accounts receivable effectively to maintain a healthy cash flow position and optimize working capital efficiency.
Peer comparison
Dec 31, 2023