Philip Morris International Inc (PM)

Days Sales Outstanding (DSO) is a key metric used to evaluate how efficiently a company collects its accounts receivable. Lower DSO values indicate faster collections, which is generally positive as it implies the company is converting its sales into cash quickly.

Analyzing the DSO trend of Philip Morris International Inc, we observe fluctuations over the period from March 31, 2020, to December 31, 2024. The DSO initially decreased from 15.44 days on March 31, 2020, to a low of 13.99 days on December 31, 2021, indicating improved efficiency in collecting receivables. Subsequently, there was a slight increase in DSO to 17.40 days on June 30, 2022, followed by relatively stable levels around 17-18 days until September 30, 2023.

However, a notable increase in DSO was observed in the following quarters, reaching 53.43 days by March 31, 2024, and remaining high around 50 days for the subsequent quarters. This suggests a potential slowdown in collections and a longer period for the company to convert sales into cash.

The significant spike in DSO in the latter periods may be a cause for concern as it could signal issues with accounts receivable management or credit policies. Investors and stakeholders should closely monitor this metric to ensure the company maintains efficient cash flow and liquidity. Further analysis of the reasons behind the extended DSO period and corresponding actions by the company would be essential to assess the impact on Philip Morris International's financial performance and operations.

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Dec 31, 2024