Northrop Grumman Corporation (NOC)

Days of sales outstanding (DSO)

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Receivables turnover		5.71	5.50	4.88	5.13	5.54
DSO	days	63.87	66.39	74.73	71.22	65.87

December 31, 2024 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 5.71
= 63.87

Based on the provided data, Northrop Grumman Corporation's Days of Sales Outstanding (DSO) has shown some fluctuation over the years. In December 2020, the DSO was 65.87 days, which increased to 71.22 days by the end of December 2021. Subsequently, there was a further increase to 74.73 days by December 2022.

However, the trend shifted in December 2023, with a decrease in DSO to 66.39 days, followed by a further reduction to 63.87 days by the end of December 2024. The decreasing DSO figures in the latter years suggest that Northrop Grumman has been able to collect its accounts receivable more efficiently, indicating improved cash flow management or potentially more aggressive collections practices.

Overall, the fluctuation in Northrop Grumman's DSO over the years may indicate changes in the company's credit policies, customer payment behaviors, or the efficiency of its account receivables management. It is essential for investors and stakeholders to closely monitor this metric to assess the company's liquidity and collections efficiency.