AutoNation Inc (AN)

Inventory turnover

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020
Cost of revenue (ttm)	US$ in thousands	22,098,200	21,736,200	21,931,000	22,108,600	21,874,800	21,680,300	21,435,400	21,388,100	21,719,700	21,565,300	21,319,700	21,464,300	20,891,400	20,429,100	19,754,900	17,840,800	16,823,600	16,678,500	16,818,900	17,533,900
Inventory	US$ in thousands	3,360,000	3,530,800	3,553,900	3,002,700	3,033,400	2,645,600	2,572,500	2,196,200	2,048,300	1,851,300	1,905,300	1,698,300	1,847,900	1,496,600	1,756,200	2,254,600	2,598,500	2,482,500	2,432,300	3,677,000
Inventory turnover		6.58	6.16	6.17	7.36	7.21	8.19	8.33	9.74	10.60	11.65	11.19	12.64	11.31	13.65	11.25	7.91	6.47	6.72	6.91	4.77

December 31, 2024 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $22,098,200K ÷ $3,360,000K
= 6.58

AutoNation Inc's inventory turnover has shown fluctuations over the period from March 31, 2020, to December 31, 2024, based on the provided data. The inventory turnover ratio represents how efficiently the company manages its inventory by selling and replacing it within a certain period.

The trend in AutoNation's inventory turnover indicates an initial increase from 4.77 on March 31, 2020, to peaking at 13.65 on September 30, 2021. This substantial rise suggests that the company was able to sell its inventory at a faster pace during this period, which may indicate effective inventory management.

However, from December 31, 2021, to December 31, 2024, the inventory turnover ratio decreased gradually, demonstrating a decline in the rate at which the company is selling and replacing its inventory. This could imply potential challenges in managing inventory levels efficiently or changes in demand dynamics impacting sales.

Overall, AutoNation's inventory turnover ratio fluctuated throughout the period under review, showcasing both periods of efficiency and potential challenges in managing inventory effectively. A higher inventory turnover ratio generally indicates better inventory management, while a lower ratio may suggest excess inventory or potential sales challenges. Monitoring and analyzing inventory turnover trends can provide valuable insights into a company's operational efficiency and financial performance.