Vertex Pharmaceuticals Inc (VRTX)

Days of sales outstanding (DSO)

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	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
Receivables turnover		6.82	6.05	6.21	5.64	6.27	6.24	6.07	5.91	6.15	6.23	6.21	6.09	6.60	6.42	7.13	6.50	6.94	7.49	6.75	5.64
DSO	days	53.48	60.38	58.78	64.68	58.21	58.52	60.14	61.78	59.39	58.59	58.78	59.93	55.33	56.83	51.21	56.14	52.57	48.70	54.04	64.77

December 31, 2024 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 6.82
= 53.48

Days Sales Outstanding (DSO) is a critical financial ratio used to evaluate how efficiently a company is able to collect its accounts receivable. It indicates the average number of days it takes for a company to collect payment after a sale has been made.

Analyzing the DSO trend of Vertex Pharmaceuticals Inc over the reporting periods reveals that the company's DSO has fluctuated within a range. The DSO values have ranged from a low of 48.70 days to a high of 64.77 days during the periods evaluated.

It is observed that there was a decreasing trend in DSO from March 31, 2020, to September 30, 2020, indicating that Vertex Pharmaceuticals was able to collect its receivables more quickly during this period. However, there was a slight increase in DSO in the following periods.

The DSO figures varied moderately over the subsequent quarters but remained relatively consistent, indicating that Vertex Pharmaceuticals Inc generally maintains a stable collections process.

It is important for Vertex Pharmaceuticals Inc to monitor its DSO closely to ensure efficient management of accounts receivable and timely collection of payments from its customers. A consistently high DSO can indicate potential liquidity issues, while a low DSO may suggest aggressive credit policies or ineffective collection efforts. It is recommended for the company to continue monitoring and evaluating its DSO trend to optimize its working capital management.