Century Communities Inc (CCS)

Days of inventory on hand (DOH)

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Inventory turnover		0.15	0.15	0.16	0.16	28.66
DOH	days	2,400.37	2,451.25	2,343.40	2,301.19	12.74

December 31, 2024 calculation

DOH = 365 ÷ Inventory turnover
= 365 ÷ 0.15
= 2,400.37

The days of inventory on hand (DOH) for Century Communities Inc have shown a significant increase from 12.74 days as of December 31, 2020, to 2,301.19 days as of December 31, 2021. This sharp spike suggests that the company may be holding excessive inventory relative to its sales or production levels. The DOH continued to rise in the following years, reaching 2,343.40 days as of December 31, 2022, 2,451.25 days as of December 31, 2023, and then slightly decreasing to 2,400.37 days as of December 31, 2024.

Such a prolonged period of inventory turnover raises concerns about potential issues in managing inventory levels efficiently. A high DOH may indicate that the company is struggling to sell its products promptly or that its production processes are not aligned with customer demand. It could tie up working capital in excess inventory, leading to increased holding costs and potentially resulting in obsolescence risks.

Century Communities Inc may need to reassess its inventory management strategies, possibly by refining forecasting methods, streamlining production processes, or implementing more effective inventory control mechanisms to optimize its working capital and improve overall operational efficiency.