Woodward Inc (WWD)
Days of sales outstanding (DSO)
| 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 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Receivables turnover | 6.91 | 6.51 | 5.61 | 6.13 | 5.74 | 5.64 | 5.76 | 6.97 | 6.29 | 6.82 | 6.56 | 8.09 | 6.63 | 5.56 | 5.27 | 6.61 | 6.40 | 7.25 | 6.64 | 7.82 | |
| DSO | days | 52.82 | 56.10 | 65.10 | 59.57 | 63.61 | 64.76 | 63.33 | 52.33 | 57.99 | 53.54 | 55.63 | 45.13 | 55.09 | 65.66 | 69.26 | 55.21 | 57.02 | 50.33 | 54.93 | 46.67 |
September 30, 2024 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 6.91
= 52.82
Days Sales Outstanding (DSO) measures the average number of days it takes for a company to collect payment after a sale has been made. A lower DSO indicates that the company is efficient in collecting payments from its customers, while a higher DSO may suggest inefficiencies in the company's account receivables management.
Analyzing Woodward Inc's DSO over the past 8 quarters, we observe fluctuations in the collection period. The DSO has ranged from a low of 45.13 days in December 2021 to a high of 69.26 days in March 2021, showing some variability in the company's collection efficiency. The company's DSO has generally been within the range of 50 to 70 days, indicating that Woodward Inc typically takes around 2 to 3 months on average to collect payments from its customers.
It is important for Woodward Inc to closely monitor its DSO and work towards reducing it where possible to free up cash flow and improve liquidity. A higher DSO could potentially lead to cash flow constraints and increased credit risk if customers delay payments significantly. By implementing efficient accounts receivable management strategies, Woodward Inc can enhance its cash flow position and overall financial health.