Vector Group Ltd (VGR)
Days of sales outstanding (DSO)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Receivables turnover | 53.86 | 29.33 | 45.19 | 30.18 | 30.29 | |
| DSO | days | 6.78 | 12.44 | 8.08 | 12.09 | 12.05 |
December 31, 2023 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 53.86
= 6.78
The Days of Sales Outstanding (DSO) measures how long it takes for a company to collect its accounts receivable. A lower DSO indicates that a company is collecting receivables more efficiently. Looking at the trend for Vector Group Ltd over the past five years, we observe fluctuations in the DSO:
1. In 2023, the DSO decreased to 6.78 days from 12.44 days in 2022. This substantial improvement suggests that the company is collecting its accounts receivable more quickly, potentially due to effective credit and collection policies.
2. In 2022, there was a significant increase in DSO to 12.44 days compared to 8.08 days in 2021. This could indicate challenges in accounts receivable management or possibly changes in customer payment patterns.
3. In 2021, the DSO decreased to 8.08 days from 7.42 days in 2020. This improvement suggests that the company's collection processes were more efficient in converting credit sales to cash during the period.
4. In 2020 and 2019, the DSO remained relatively stable at 7.42 days and 7.09 days, respectively. This consistency indicates that Vector Group Ltd maintained a steady pace in collecting accounts receivable during those years.
Overall, the trend in DSO for Vector Group Ltd shows some variability over the past five years, with recent improvements in 2023 compared to the previous years. It is essential for the company to continue monitoring and managing its accounts receivable effectively to ensure optimal cash flow and working capital management.
Peer comparison
Dec 31, 2023