Best Buy Co. Inc (BBY)
Days of inventory on hand (DOH)
| Feb 1, 2025 | Feb 3, 2024 | Jan 28, 2023 | Jan 29, 2022 | Jan 30, 2021 | ||
|---|---|---|---|---|---|---|
| Inventory turnover | 6.32 | 6.83 | 7.08 | 6.73 | 6.54 | |
| DOH | days | 57.74 | 53.46 | 51.56 | 54.27 | 55.83 |
February 1, 2025 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 6.32
= 57.74
Days of Inventory on Hand (DOH) is a key ratio that measures the average number of days a company holds its inventory before selling it. Analyzing Best Buy Co. Inc's DOH over the past five years reveals a generally decreasing trend from 55.83 days as of January 30, 2021, to 57.74 days as of February 1, 2025.
The decreasing trend in DOH indicates an improvement in inventory management efficiency, as the company is taking less time to sell its inventory. This could be attributed to better demand forecasting, streamlined inventory processes, or faster inventory turnover. However, the slight increase in DOH in the latest period suggests a potential slowdown in inventory management efficiency.
Overall, the decreasing trend in DOH over the analyzed period reflects positively on Best Buy's ability to manage its inventory effectively. It is essential for the company to continue monitoring and improving its inventory management practices to optimize working capital and profitability.