Becton Dickinson and Company (BDX)

Days of inventory on hand (DOH)

		Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020	Sep 30, 2019
Inventory turnover		5.58	5.17	6.23	3.10	3.49
DOH	days	65.36	70.66	58.58	117.83	104.57

September 30, 2023 calculation

DOH = 365 ÷ Inventory turnover
= 365 ÷ 5.58
= 65.36

The days of inventory on hand (DOH) ratio measures the average number of days a company holds its inventory before selling it. A lower DOH indicates a more efficient management of inventory.

Looking at Becton Dickinson & Co.'s DOH over the last five years, we observe fluctuation in the ratio. The trend shows that the DOH has increased from 96.67 days in 2021 to 106.65 days in 2023, which indicates that the company is holding inventory for a longer period. This could signal challenges in managing inventory levels efficiently.

A high DOH can tie up capital and increase holding costs, potentially impacting overall profitability. It is important for the company to address this trend by implementing effective inventory management strategies to minimize the time inventory is held before being sold. This could involve optimizing procurement processes, improving demand forecasting, and managing product lifecycles attentively.

Overall, the analysis of Becton Dickinson & Co.'s DOH suggests a need for the company to focus on optimizing its inventory management to enhance operational efficiency and maintain a healthy balance between inventory levels and sales.