AAR Corp (AIR)
Days of inventory on hand (DOH)
| May 31, 2024 | May 31, 2023 | May 31, 2022 | May 31, 2021 | May 31, 2020 | ||
|---|---|---|---|---|---|---|
| Inventory turnover | 3.00 | 0.41 | 0.37 | 0.36 | 0.38 | |
| DOH | days | 121.82 | 900.50 | 974.45 | 1,020.79 | 963.69 |
May 31, 2024 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 3.00
= 121.82
AAR Corp's days of inventory on hand (DOH) has shown a significant improvement over the past five years, declining from 963.69 days in 2020 to 121.82 days in 2024. This decrease indicates that the company has become more efficient in managing its inventory levels.
The sharp decline in DOH can be seen as a positive sign as it suggests that AAR Corp has been able to streamline its inventory management processes, reduce excess stock, and optimize its supply chain operations. Lower DOH typically indicates that the company is selling its inventory more quickly, which can lead to improved cash flow and profitability.
The drastic reduction in DOH from 2020 to 2024 may indicate that AAR Corp has implemented better inventory control measures, such as more accurate demand forecasting, enhanced inventory tracking systems, and tighter inventory management policies.
Overall, the trend of declining DOH for AAR Corp signifies improved operational efficiency and inventory management practices, which can positively impact the company's financial performance and competitiveness in the market.
Peer comparison
May 31, 2024