Select Medical Holdings (SEM)
Days of sales outstanding (DSO)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Receivables turnover | 6.87 | 6.96 | 7.21 | 6.41 | 7.26 | |
| DSO | days | 53.15 | 52.46 | 50.62 | 56.94 | 50.25 |
December 31, 2023 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 6.87
= 53.15
The days of sales outstanding (DSO) for Select Medical Holdings Corporation have fluctuated over the past five years. In 2023, the DSO decreased to 51.50 days from 54.25 days in 2022, indicating an improvement in the company's ability to collect its accounts receivable in a timely manner. This may suggest effective credit and collection management practices.
Comparing the DSO to previous years, it is lower than the 2020 and 2019 figures, indicating a positive trend in managing accounts receivable turnover. However, there was a slight increase in DSO from 2021 to 2022 before the improvement in 2023.
Overall, a lower DSO is generally preferable as it indicates that the company is collecting payments from customers more quickly, which can improve cash flow and liquidity. Select Medical Holdings Corporation's decreasing DSO trend in 2023 is a positive signal of efficient accounts receivable management. Monitoring this ratio over future periods will be crucial to assess the company's continued effectiveness in managing its receivables.
Peer comparison
Dec 31, 2023