Axalta Coating Systems Ltd (AXTA)
Inventory turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 4,679,000 | 4,527,600 | 4,564,600 | 4,082,000 | 3,545,100 |
| Inventory | US$ in thousands | 734,000 | 741,000 | 829,600 | 669,700 | 559,900 |
| Inventory turnover | 6.37 | 6.11 | 5.50 | 6.10 | 6.33 |
December 31, 2024 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $4,679,000K ÷ $734,000K
= 6.37
Inventory turnover is a key ratio that measures how efficiently a company manages its inventory by assessing how many times it sells and replenishes its inventory during a specific period. In the case of Axalta Coating Systems Ltd, the trend in inventory turnover over the five-year period from December 31, 2020, to December 31, 2024, shows fluctuations.
The inventory turnover ratio for Axalta Coating Systems Ltd decreased from 6.33 in December 31, 2020, to 5.50 in December 31, 2022, indicating that the company took longer to sell and replenish its inventory in 2022 compared to 2020. This decline could be a red flag as it suggests a potential issue with managing inventory efficiently.
However, the inventory turnover ratio improved in the following years, reaching 6.37 by December 31, 2024. This upward trend indicates that the company was able to sell and replenish its inventory more frequently in 2024, which could signify better inventory management practices or increased demand for its products.
Overall, while there were fluctuations in inventory turnover for Axalta Coating Systems Ltd over the five-year period, the recent improvement in the ratio suggests a positive trend in managing inventory efficiently. It would be important for the company to continue monitoring and optimizing its inventory turnover to ensure operational efficiency and profitability.
Peer comparison
Dec 31, 2024