American Electric Power Company Inc (AEP)

Inventory turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cost of revenue	US$ in thousands	1,434,500	1,556,800	1,400,700	1,297,500	1,214,000
Inventory	US$ in thousands	1,879,500	1,302,100	989,200	1,310,000	1,169,200
Inventory turnover		0.76	1.20	1.42	0.99	1.04

December 31, 2023 calculation

Inventory turnover = Cost of revenue ÷ Inventory
= $1,434,500K ÷ $1,879,500K
= 0.76

American Electric Power Company Inc.'s inventory turnover has fluctuated over the past five years, reflecting the efficiency of the company in managing its inventory. The inventory turnover ratio measures how many times a company sells and replaces its inventory within a specific period.

In 2023, the inventory turnover ratio was 3.50, indicating that the company sold and replaced its inventory approximately 3.50 times during the year. This was a decrease from the previous year's ratio of 5.45. The decrease in inventory turnover could suggest that the company either held onto inventory for a longer period or experienced lower sales during the year.

Comparing the 2023 ratio to previous years, we see that it is lower than the ratios of 2022 and 2021 but higher than the ratios of 2020 and 2019. The variability in inventory turnover ratios could be influenced by factors such as changes in demand, production efficiency, inventory management practices, or industry trends.

Overall, the decreasing trend in inventory turnover from 2021 to 2023 may indicate a potential concern regarding the management of inventory levels and sales efficiency. Further analysis of the company's operations and industry dynamics would be necessary to fully understand the implications of these fluctuations in the inventory turnover ratio for American Electric Power Company Inc.