Scholastic Corporation (SCHL)
Days of sales outstanding (DSO)
| May 31, 2024 | Feb 29, 2024 | Nov 30, 2023 | Aug 31, 2023 | May 31, 2023 | Feb 28, 2023 | Nov 30, 2022 | Aug 31, 2022 | May 31, 2022 | Feb 28, 2022 | Nov 30, 2021 | Aug 31, 2021 | May 31, 2021 | Feb 28, 2021 | Nov 30, 2020 | Aug 31, 2020 | May 31, 2020 | Feb 29, 2020 | Nov 30, 2019 | Aug 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Receivables turnover | 6.35 | 5.80 | 5.08 | 7.09 | 5.93 | 5.83 | 4.71 | 5.81 | 5.03 | 4.90 | 3.80 | 4.78 | 3.75 | 3.49 | 3.22 | 4.55 | 4.51 | 5.95 | 5.11 | 7.38 | |
| DSO | days | 57.52 | 62.89 | 71.81 | 51.45 | 61.51 | 62.61 | 77.57 | 62.88 | 72.60 | 74.51 | 96.11 | 76.34 | 97.28 | 104.70 | 113.21 | 80.17 | 80.95 | 61.32 | 71.46 | 49.47 |
May 31, 2024 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 6.35
= 57.52
The Days of Sales Outstanding (DSO) is a key financial ratio used to measure the average number of days it takes for a company to collect payment after making a sale. A lower DSO indicates that a company is collecting payments more quickly, which is generally favorable as it improves cash flow and liquidity.
Analyzing Scholastic Corporation's DSO over the past several quarters, we observe fluctuations in the metric. In the latest quarter ending May 31, 2024, the DSO stood at 57.52 days, a decrease from the prior quarter when it was 62.89 days. This reduction suggests that the company has been able to collect payments more efficiently, which is a positive indicator of effective credit management and potentially improving customer payment behavior.
Looking back at historical data, we notice that Scholastic Corporation's DSO has shown variability over time. There have been instances of elevated DSO levels, such as the peaks seen in November 2021 (96.11 days) and February 2021 (104.70 days), which may indicate challenges in collecting receivables promptly during those periods.
On the other hand, there are periods, like November 2020 (113.21 days) and August 2019 (80.95 days), where the DSO was relatively high, signaling potential issues with accounts receivable management and collection processes.
Overall, monitoring the trend in DSO can provide insights into the effectiveness of Scholastic Corporation's credit policies, collection practices, and customer payment behavior. The company should aim to maintain a balance between timely cash inflows and sales growth to ensure sustainable financial performance and liquidity.
Peer comparison
May 31, 2024