AAR Corp (AIR)

The analysis of AAR Corp's inventory turnover ratios over the specified periods reveals several noteworthy trends and insights. As of May 31, 2021, the inventory turnover was documented at 2.55, indicating that the company sold and replaced its inventory approximately 2.55 times during that fiscal year. This ratio increased modestly to 2.74 by May 31, 2022, reflecting a slight improvement in inventory management efficiency, with inventories turning over more frequently within the year. The upward trend continued into May 31, 2023, reaching 2.82, further indicating enhanced efficiency in inventory utilization over this period.

However, a significant decline is observed in the subsequent year, with the inventory turnover decreasing to 2.56 by May 31, 2024. This drop suggests a slowdown in the rate at which inventory was converted into sales, potentially pointing to increased inventory levels relative to sales or decreased sales activity that year. Finally, the ratio on May 31, 2025, is recorded as 0.00, which implies that there was either no inventory turnover or a potential issue with data reporting or accounting classification in that period. The latter scenario could indicate discontinued operations, inventory write-downs, or errors in inventory reporting.

Over the analyzed period, the fluctuating inventory turnover ratios highlight periods of operational efficiency and potential concerns related to inventory management. The initial upward trend suggests effective inventory control and sales performance improvements, while the subsequent decline raises questions about inventory holding periods and sales efficacy in recent years. The abrupt drop to zero warrants further investigation to determine whether it reflects genuine operational issues, data anomalies, or specific accounting circumstances impacting inventory reporting.

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May 31, 2025