AutoNation Inc (AN)

Inventory turnover

		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	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Cost of revenue (ttm)	US$ in thousands	21,817,400	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	17,812,700	17,723,200	17,643,300	17,730,500
Inventory	US$ in thousands	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	3,305,800	3,280,700	3,517,900	3,771,400
Inventory turnover		7.19	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	5.39	5.40	5.02	4.70

December 31, 2023 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $21,817,400K ÷ $3,033,400K
= 7.19

The inventory turnover of Autonation Inc. has shown a declining trend over the past eight quarters, decreasing from 12.64 in Q1 2022 to 7.19 in Q4 2023. This indicates that the company's efficiency in managing its inventory levels has decreased. A lower inventory turnover ratio may suggest that Autonation Inc. is carrying excess inventory or facing challenges in selling its products quickly.

The Q4 2023 inventory turnover of 7.19 is notably lower than the average of the previous quarters, indicating potential inventory management issues during this period. It is essential for Autonation Inc. to address these concerns to improve its operational efficiency and reduce the risk of holding obsolete or slow-moving inventory.

Overall, the decreasing trend in Autonation Inc.'s inventory turnover ratios highlights the importance of closely monitoring and managing inventory levels to optimize working capital and enhance profitability.