Ufp Industries Inc (UFPI)
Days of sales outstanding (DSO)
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Receivables turnover | 12.47 | 10.51 | 9.93 | — | 14.79 | 10.73 | 8.97 | 8.49 | 11.63 | 10.04 | 7.55 | 7.36 | 10.82 | 8.16 | 8.48 | 9.57 | 11.70 | 9.25 | 9.22 | 10.05 | |
| DSO | days | 29.27 | 34.74 | 36.76 | — | 24.67 | 34.01 | 40.71 | 42.99 | 31.39 | 36.35 | 48.33 | 49.60 | 33.73 | 44.73 | 43.04 | 38.16 | 31.19 | 39.45 | 39.59 | 36.31 |
December 31, 2023 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 12.47
= 29.27
The Days Sales Outstanding (DSO) ratio measures how long, on average, it takes for a company to collect payments from its credit sales. A lower DSO indicates better liquidity and efficient collection practices, while a higher DSO may signal potential issues with accounts receivable management.
Analyzing the DSO trend for Ufp Industries Inc over the past few quarters, we can observe the following:
1. The DSO has fluctuated over the periods provided, ranging from 24.67 days to 49.60 days.
2. The latest DSO of 29.27 days (as of December 31, 2023) shows an improvement compared to the previous quarter, indicating a more efficient collection process.
3. On a year-over-year basis, the DSO seems to have decreased overall, with a few exceptions of higher DSO observed in certain quarters.
4. The highest DSO of 49.60 days in March 31, 2021, may be a red flag indicating a potential slowdown in collections efficiency during that period.
5. Overall, a downward trend in DSO is usually seen as positive, as it suggests the company is collecting payments faster and managing its receivables effectively.
In conclusion, the analysis of Ufp Industries Inc's DSO trend indicates fluctuations in the efficiency of accounts receivable collections over the periods provided, with the company showing improvement in recent quarters. Monitoring DSO trends continuously can provide valuable insights into the company's liquidity, operational efficiency, and financial management practices.