Packaging Corp of America (PKG)
Days of sales outstanding (DSO)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Receivables turnover | 7.44 | 7.83 | 6.94 | 7.81 | 7.78 | |
| DSO | days | 49.07 | 46.59 | 52.60 | 46.75 | 46.89 |
December 31, 2023 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 7.44
= 49.07
Packaging Corp Of America's Days of Sales Outstanding (DSO) measures how efficiently the company is collecting its accounts receivable. A lower DSO indicates faster collection of receivables, which is generally considered favorable as it allows the company to convert sales into cash more quickly.
From the data provided, the company's DSO has fluctuated over the past five years. In 2023, the DSO stood at 48.53 days, higher compared to the previous year's 45.96 days. This increase suggests that the company took slightly longer to collect its accounts receivable in 2023.
Comparing 2023 to 2021, the DSO decreased from 50.92 days to 48.53 days, indicating an improvement in collecting receivables more efficiently. Similarly, there was a slight decrease in DSO from 2019 to 2020, from 45.71 days to 45.91 days.
Overall, while there have been fluctuations in Packaging Corp Of America's DSO over the years, the company has generally maintained a relatively consistent collection efficiency. It is essential for the company to monitor its DSO closely and work towards optimizing its accounts receivable collection process to ensure a healthy cash flow and overall financial performance.
Peer comparison
Dec 31, 2023