Baxter International Inc (BAX)
Inventory turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 16,080,000 | 18,332,000 | 11,536,000 | 10,557,000 | 10,845,000 |
| Inventory | US$ in thousands | 2,824,000 | 2,679,000 | 2,453,000 | 1,916,000 | 1,653,000 |
| Inventory turnover | 5.69 | 6.84 | 4.70 | 5.51 | 6.56 |
December 31, 2023 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $16,080,000K ÷ $2,824,000K
= 5.69
Inventory turnover is a key performance metric that indicates how efficiently a company manages its inventory. Baxter International Inc.'s inventory turnover has shown some fluctuations over the past five years. The inventory turnover ratio decreased from 3.99 in 2019 to 3.70 in 2020, suggesting a decrease in the efficiency of the company in managing its inventory. However, the ratio improved to 3.13 in 2021 but slightly declined again in 2022 to 3.57. In 2023, the inventory turnover further decreased to 3.48.
Overall, Baxter International Inc. has been able to effectively turn over its inventory, on average, around 3 to 4 times a year in the last five years. This indicates that the company is efficiently managing its inventory levels and has a good balance between stock levels and sales volume. However, the slight decline in the inventory turnover ratio in recent years may suggest a need for the company to reassess its inventory management strategies to continue optimizing its operations.
Peer comparison
Dec 31, 2023