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GuruFocus has detected 4 Warning Signs with Apollo Education Group Inc \$APOL.
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Apollo Education Group Inc (NAS:APOL)
Accounts Receivable
\$235 Mil (As of Nov. 2016)

Accounts Receivable are created when a customer has received a product but has not yet paid for that product. Apollo Education Group Inc's accounts receivables for the quarter that ended in Nov. 2016 was \$235 Mil.

Accounts receivable can be measured by Days Sales Outstanding. Apollo Education Group Inc's Days Sales Outstanding for the quarter that ended in Nov. 2016 was 44.20.

In Ben Grahams calculation of liquidation value, accounts receivable are only considered to be worth 75% of book value. Apollo Education Group Inc's Liquidation Value for the quarter that ended in Nov. 2016 was \$-82 Mil.

Definition

Accounts Receivable is money owed to a business by customers and shown on its Balance Sheet as an asset.

Explanation

1. Accounts Receivable are created when a customer has received a product but has not yet paid for that product. Days sales outstanding measures of the average number of days that a company takes to collect revenue after a sale has been made. It is a financial ratio that illustrates how well a company's accounts receivables are being managed.

Apollo Education Group Inc's Days Sales Outstanding for the quarter that ended in Nov. 2016 is calculated as:

 Days Sales Outstanding = Account Receivable / Revenue * Days in Period = 234.676 / 484.499 * 91 = 44.20

2. In Ben Grahams calculation of liquidation value, Apollo Education Group Inc's accounts receivable are only considered to be worth 75% of book value:

Apollo Education Group Inc's liquidation value for the quarter that ended in Nov. 2016 is calculated as:

 Liquidation value = Cash and Cash Equivalents - Total Liabilities + (0.75 * Account Receivable) + (0.5 * Inventory) = 634.666 - 892.304 + 0.75 * 234.676 + 0.5 * 0 = -82

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Be Aware

Net receivables tells us a great deal about the different competitors in the same industry. In competitive industries, some attempt to gain advantage by offering better credit terms, causing increase in sales and receivables.

If company consistently shows lower % Net receivables to gross sales than competitors, then it usually has some kind of competitive advantage which requires further digging.

Average Days Sales Outstanding is a good indicator for measuring a companys sales channel and customers. A company may book great revenue and earnings growth but never receive payment from their customers. This may force a write-off in the future and depress future earnings.

Related Terms

Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Apollo Education Group Inc Annual Data

 Aug07 Aug08 Aug09 Aug10 Aug11 Aug12 Aug13 Aug14 Aug15 Aug16 Accts Rec. 182 222 298 264 195 180 184 205 192 210

Apollo Education Group Inc Quarterly Data

 Aug14 Nov14 Feb15 May15 Aug15 Nov15 Feb16 May16 Aug16 Nov16 Accts Rec. 205 239 224 207 192 206 231 181 210 235
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