ADMA Biologics Inc (ADMA)

Inventory turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cost of revenue	US$ in thousands	169,273	118,815	79,769	61,291	39,504
Inventory	US$ in thousands	172,906	163,280	124,724	81,536	53,065
Inventory turnover		0.98	0.73	0.64	0.75	0.74

December 31, 2023 calculation

Inventory turnover = Cost of revenue ÷ Inventory
= $169,273K ÷ $172,906K
= 0.98

The inventory turnover for ADMA Biologics Inc has shown a fluctuating trend over the past five years. In 2023, the inventory turnover ratio improved to 0.98 from 0.73 in 2022, indicating that the company was able to sell its inventory more efficiently during the year. This could suggest improved inventory management or stronger sales performance.

While the 2023 ratio is higher than the previous year, it is important to note that the inventory turnover has generally been below 1 over the past five years. This implies that, on average, the company's inventory is held for more than one year before being sold.

The inventory turnover ratio measures how many times a company sells and replaces its inventory during a period. A higher ratio is typically considered better as it indicates efficient management of inventory levels. In contrast, a lower ratio may signal excess inventory or potential difficulties in selling products.

Overall, while the improvement in inventory turnover in 2023 is a positive sign, the company may still benefit from further optimizing its inventory management practices to enhance efficiency and profitability.