Cal-Maine Foods Inc (CALM)
Inventory turnover
| Jun 1, 2024 | Jun 3, 2023 | May 28, 2022 | May 29, 2021 | May 30, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 2,016,140 | 2,184,200 | 1,640,950 | 1,376,580 | 1,172,020 |
| Inventory | US$ in thousands | 261,782 | 284,418 | 263,316 | 218,375 | 187,216 |
| Inventory turnover | 7.70 | 7.68 | 6.23 | 6.30 | 6.26 |
June 1, 2024 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $2,016,140K ÷ $261,782K
= 7.70
Cal-Maine Foods Inc's inventory turnover has been relatively stable over the past five years, ranging from 6.23 to 7.70. This ratio indicates how efficiently the company manages its inventory by measuring how many times it sells and replaces its inventory within a given period. A higher inventory turnover ratio suggests that the company is selling goods more quickly and efficiently.
In the latest year, the inventory turnover ratio increased to 7.70 from 7.68 in the previous year, indicating a slight improvement in inventory management efficiency. This could be attributed to better inventory control, effective sales strategies, or improved demand forecasting.
Overall, Cal-Maine Foods Inc's inventory turnover ratio has been consistently above 6, which generally indicates that the company is effectively managing its inventory levels and turning over its inventory in a timely manner. This efficiency in managing inventory can help reduce holding costs, prevent stock obsolescence, and improve cash flow.