Avanos Medical Inc (AVNS)
Inventory turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 681,100 | 745,400 | 727,800 | 745,300 | 714,500 |
| Inventory | US$ in thousands | 163,200 | 132,300 | 159,300 | 168,900 | 145,900 |
| Inventory turnover | 4.17 | 5.63 | 4.57 | 4.41 | 4.90 |
December 31, 2023 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $681,100K ÷ $163,200K
= 4.17
The inventory turnover ratio of Avanos Medical Inc has shown a declining trend over the past five years, starting at 2.02 in both 2019 and 2020, increasing to 2.53 in 2021, and then decreasing to 1.94 in 2022 and further to 1.80 in 2023.
A decreasing inventory turnover ratio may indicate that the company is holding onto inventory for longer periods, which could tie up working capital and lead to potential obsolescence or higher carrying costs. This trend warrants further investigation into the company's inventory management practices, demand forecasting, and supply chain efficiency to optimize inventory turnover and mitigate associated risks.
Peer comparison
Dec 31, 2023