Balchem Corporation (BCPC)
Days of inventory on hand (DOH)
| 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Inventory turnover | 5.66 | 5.42 | 5.23 | 5.32 | 5.53 | 4.64 | 4.32 | 5.41 | 6.10 | 6.48 | 6.54 | 6.33 | 6.79 | 6.04 | 5.57 | 5.33 | 5.15 | 5.86 | 6.35 | 6.55 | |
| DOH | days | 64.44 | 67.35 | 69.84 | 68.59 | 65.99 | 78.67 | 84.53 | 67.49 | 59.79 | 56.35 | 55.79 | 57.66 | 53.73 | 60.38 | 65.58 | 68.47 | 70.83 | 62.33 | 57.44 | 55.71 |
December 31, 2023 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 5.66
= 64.44
Days of Inventory on Hand (DOH) is a key financial metric used to measure how efficiently a company manages its inventory. A lower DOH indicates that a company is selling its inventory more quickly, while a higher DOH suggests that inventory is sitting idle for a longer period.
In the case of Balchem Corp., the trend of the DOH over the past quarters shows some fluctuations. In Q4 2023, the DOH was 64.44 days, lower than the previous quarters, indicating that the company managed its inventory more efficiently during that period. This improvement could be attributed to better inventory management practices, increased sales, or effective demand forecasting.
Although the DOH increased slightly in Q3 and Q2 2023 compared to Q1 2023, the overall trend showed a decrease from the highest value of 84.53 days in Q3 2022. This suggests that Balchem Corp. has been successful in reducing the amount of time its inventory sits on the shelves, which may have positive implications for cash flow and profitability.
However, it is important for Balchem Corp. to monitor its inventory turnover regularly to ensure that inventory levels are in line with sales demand. A consistently low DOH indicates strong inventory management practices and can lead to lower carrying costs and improved financial performance in the long run.
Peer comparison
Dec 31, 2023