Topbuild Corp (BLD)
Days of inventory on hand (DOH)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Inventory turnover | 12.24 | 9.89 | 8.80 | 15.04 | 16.01 | |
| DOH | days | 29.82 | 36.92 | 41.48 | 24.28 | 22.79 |
December 31, 2023 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 12.24
= 29.82
TopBuild Corp's days of inventory on hand (DOH) has shown a declining trend over the past five years, indicating an improvement in managing inventory levels efficiently. In 2019, the company held inventory for an average of 28.01 days, which increased to 29.87 days in 2020 before decreasing significantly to 51.27 days in 2021. The trend reversed in 2022 and 2023, with the DOH decreasing to 45.46 days and 37.07 days, respectively.
The fluctuation in DOH suggests potential changes in inventory management strategies or external factors impacting inventory levels. A lower DOH indicates that TopBuild Corp is selling its inventory more quickly, which can lead to lower storage costs and reduced risk of obsolete inventory. However, an excessively low DOH may imply stockouts or missed sales opportunities.
Overall, the trend in TopBuild Corp's DOH reflects a mix of effective inventory management and potential challenges in forecasting demand accurately. Further analysis of the company's operational efficiency and market conditions would provide a more in-depth understanding of its inventory management practices.