Paychex Inc (PAYX)

The Days of Sales Outstanding (DSO) for Paychex Inc has exhibited a consistent upward trend over the analyzed period from May 31, 2021, through May 31, 2025. Specifically, the DSO increased from approximately 94.79 days in 2021 to 104.33 days in 2022, representing an approximately 10% rise. This upward progression continued in 2023, reaching 103.96 days, which indicates a stabilization at a slightly lower level compared to 2022 but still above the 2021 figure. The escalation persisted into 2024, with the DSO rising to approximately 112.39 days, signifying an extension of the average collection period by roughly 8 days compared to the prior year. By 2025, the DSO further extended to approximately 129.38 days, reflecting a substantial increase of nearly 17 days from the previous year.

This trend suggests that Paychex's collection period has lengthened over the four-year span, indicating that the company's receivables are taking progressively longer to convert into cash. Several factors could be contributing to this trend, including changes in credit policies, shifts in customer payment behaviors, or evolving industry standards. An increasing DSO may imply a potential deterioration in receivables management or a strategic easing of credit terms to attract or retain clients. It warrants closer scrutiny as a prolonged collection period can impact cash flow and working capital efficiency. Overall, the data demonstrates a significant shift toward longer receivable cycles, which could have implications for the company's liquidity and operational performance if the trend continues.