Archer-Daniels-Midland Company (ADM)
Inventory turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 79,752,000 | 86,422,000 | 94,278,000 | 79,262,000 | 59,902,000 |
| Inventory | US$ in thousands | 11,572,000 | 11,957,000 | 14,771,000 | 14,481,000 | 11,713,000 |
| Inventory turnover | 6.89 | 7.23 | 6.38 | 5.47 | 5.11 |
December 31, 2024 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $79,752,000K ÷ $11,572,000K
= 6.89
Archer-Daniels-Midland Company's inventory turnover has been on an upward trend from 5.11 in 2020 to 6.89 in 2024. This indicates that the company is efficiently managing its inventory, as higher inventory turnover ratios suggest that inventory is being sold or used up more quickly.
The steady increase in inventory turnover signifies that Archer-Daniels-Midland is improving its inventory management processes over time, which can lead to benefits such as reduced holding costs and better cash flow management.
A high inventory turnover ratio like the one exhibited by Archer-Daniels-Midland suggests that the company is effectively selling its products and replenishing its inventory at an optimal rate. It also indicates that the company has a strong demand for its products or efficient inventory control systems in place.
Overall, the increasing trend in inventory turnover for Archer-Daniels-Midland Company reflects positively on its operational efficiency and management of inventory levels.
Peer comparison
Dec 31, 2024