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Xyratex, Ltd. (NAS:XRTX)
Accounts Receivable
\$90.8 Mil (As of Nov. 2013)

Accounts Receivable are created when a customer has received a product but has not yet paid for that product. Xyratex, Ltd.'s accounts receivables for the quarter that ended in Nov. 2013 was \$90.8 Mil.

Accounts receivable can be measured by Days Sales Outstanding. Xyratex, Ltd.'s Days Sales Outstanding for the quarter that ended in Nov. 2013 was 44.74.

In Ben Grahams calculation of liquidation value, accounts receivable are only considered to be worth 75% of book value. Xyratex, Ltd.'s Liquidation Value for the quarter that ended in Nov. 2013 was \$127.9 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.

Xyratex, Ltd.'s Days Sales Outstanding for the quarter that ended in Nov. 2013 is calculated as:

 Days Sales Outstanding = Account Receivable / Revenue * Days in Period = 90.835 / 185.254 * 91 = 44.74

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

Xyratex, Ltd.'s liquidation value for the quarter that ended in Nov. 2013 is calculated as:

 Liquidation value = Cash and Cash Equivalents - Total Liabilities + (0.75 * Account Receivable) + (0.5 * Inventory) = 102.992 - 109.372 + 0.75 * 90.835 + 0.5 * 132.227 = 127.9

* All numbers are in millions except for per share data and ratio. All numbers are in their own 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 own currency.

Xyratex, Ltd. Annual Data

 Nov04 Nov05 Nov06 Nov07 Nov08 Nov09 Nov10 Nov11 Nov12 Nov13 Accts Rec. 49.7 82.4 105.3 122.3 140.9 124.7 209.0 200.7 132.9 90.8

Xyratex, Ltd. Quarterly Data

 Aug11 Nov11 Feb12 May12 Aug12 Nov12 Feb13 May13 Aug13 Nov13 Accts Rec. 175.2 200.7 152.1 163.6 143.2 132.9 98.8 120.2 127.6 90.8
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