Caterpillar Inc (CAT)
Inventory turnover
| 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cost of revenue (ttm) | US$ in thousands | 42,767,000 | 43,365,000 | 42,984,000 | 41,894,000 | 41,350,000 | 39,739,000 | 38,154,000 | 37,060,000 | 35,513,000 | 33,294,000 | 31,596,000 | 29,828,000 | 29,082,000 | 30,415,000 | 32,065,000 | 34,893,000 | 36,630,000 | 37,500,000 | 37,953,000 | 37,434,000 |
| Inventory | US$ in thousands | 16,565,000 | 17,580,000 | 17,746,000 | 17,633,000 | 16,270,000 | 16,860,000 | 15,881,000 | 15,038,000 | 14,038,000 | 13,666,000 | 12,672,000 | 12,149,000 | 11,402,000 | 11,453,000 | 11,371,000 | 11,748,000 | 11,266,000 | 12,180,000 | 12,007,000 | 12,340,000 |
| Inventory turnover | 2.58 | 2.47 | 2.42 | 2.38 | 2.54 | 2.36 | 2.40 | 2.46 | 2.53 | 2.44 | 2.49 | 2.46 | 2.55 | 2.66 | 2.82 | 2.97 | 3.25 | 3.08 | 3.16 | 3.03 |
December 31, 2023 calculation
Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $42,767,000K ÷ $16,565,000K
= 2.58
Caterpillar Inc.'s inventory turnover has exhibited some fluctuations over the past eight quarters. The inventory turnover ratio, which measures how effectively a company manages its inventory by indicating how many times it sells and replaces its inventory during a specific period, ranged from a low of 2.36 in Q3 2022 to a high of 2.58 in Q4 2023.
Overall, the trend in the inventory turnover ratio for Caterpillar Inc. has been relatively stable over the period under review. Despite some minor fluctuations, the ratio has generally hovered around the 2.4 to 2.6 range.
A high inventory turnover ratio indicates that the company is efficiently managing its inventory, turning it over quickly and potentially minimizing storage and carrying costs. Conversely, a low ratio may suggest slower-moving inventory or potential excess stock levels, which could tie up resources and lead to higher holding costs.
In the case of Caterpillar Inc., the inventory turnover ratios consistently above 2.0 indicate that the company is effectively managing its inventory levels. However, it is important for the company to continue monitoring and optimizing its inventory management practices to ensure efficiency and profitability in its operations.
Peer comparison
Dec 31, 2023
Dec 31, 2023