Crown Holdings Inc (CCK)
Inventory turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 11,362,000 | 12,303,000 | 12,237,000 | 11,007,000 | 9,839,000 |
| Inventory | US$ in thousands | 1,613,000 | 2,014,000 | 1,735,000 | 1,263,000 | 1,626,000 |
| Inventory turnover | 7.04 | 6.11 | 7.05 | 8.71 | 6.05 |
December 31, 2023 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $11,362,000K ÷ $1,613,000K
= 7.04
Inventory turnover is a key efficiency ratio that measures how effectively a company manages its inventory by showing how many times during a period (usually a year) the company's inventory is sold and replaced. In the case of Crown Holdings, Inc., the inventory turnover has been relatively stable over the past five years, ranging from 5.20 to 5.92.
A high inventory turnover ratio, such as what Crown Holdings, Inc. has exhibited, suggests that the company is efficient in managing its inventory levels. It indicates that the company is selling and replacing its inventory at a relatively fast pace, which can be seen positively as it minimizes the costs associated with holding excess inventory.
The consistent range of inventory turnover ratios for Crown Holdings, Inc. over the years indicates that the company has been able to maintain a balance between having enough inventory to meet customer demand and avoiding overstocking. This suggests effective inventory management practices and a good understanding of market demand.
Overall, the inventory turnover ratio analysis suggests that Crown Holdings, Inc. has been effectively managing its inventory levels over the years, which is a positive indication of operational efficiency.
Peer comparison
Dec 31, 2023