Baker Hughes Co (BKR)
Inventory turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 3,226,000 | 3,445,000 | 2,868,000 | 19,958,000 | 3,539,000 |
| Inventory | US$ in thousands | 5,094,000 | 4,587,000 | 3,979,000 | 4,421,000 | 4,608,000 |
| Inventory turnover | 0.63 | 0.75 | 0.72 | 4.51 | 0.77 |
December 31, 2023 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $3,226,000K ÷ $5,094,000K
= 0.63
The inventory turnover ratio for Baker Hughes Co has fluctuated over the past five years, ranging from 3.65 to 4.21. This ratio indicates the number of times the company's inventory is sold and replaced within a given period. A higher inventory turnover ratio is generally considered favorable as it suggests that inventory is efficiently managed and quickly converted into sales.
In this case, Baker Hughes Co's inventory turnover has shown some variability, with a peak in 2021 at 4.13 and a slight dip in 2022 to 3.65 before recovering to 3.98 in 2023. While the ratio has remained above 3 across all years, indicating that the company effectively manages its inventory, there may be some fluctuations in the efficiency of inventory turnover. It is important for the company to monitor trends in inventory turnover to ensure optimal inventory management practices are maintained.
Peer comparison
Dec 31, 2023