Central Garden & Pet Company A (CENTA)
Inventory turnover
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 2,256,720 | 2,363,240 | 2,346,280 | 2,332,780 | 1,898,950 |
| Inventory | US$ in thousands | 757,943 | 838,188 | 938,000 | 685,237 | 439,615 |
| Inventory turnover | 2.98 | 2.82 | 2.50 | 3.40 | 4.32 |
September 30, 2024 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $2,256,720K ÷ $757,943K
= 2.98
The inventory turnover ratio for Central Garden & Pet Company A has fluctuated over the past five years, ranging from a high of 4.32 in 2020 to a low of 2.50 in 2022. This ratio indicates how efficiently the company is managing its inventory by showing the number of times inventory is sold and replaced within a given period.
A higher inventory turnover is generally preferred as it suggests that the company is effectively managing its inventory levels and selling products more quickly. The decreasing trend in inventory turnover from 2020 to 2022 may indicate potential issues with inventory management or slower sales during that period.
While the inventory turnover ratio increased in 2023 and 2024 compared to the previous years, it is still lower than the 2020 level. This could suggest that the company is improving its inventory management practices but may still have room for further optimization.
Overall, Central Garden & Pet Company A should continue monitoring its inventory turnover ratio to ensure efficient management of inventory levels and strive for a balance between carrying enough inventory to meet demand and minimizing excess inventory that could tie up capital.
Peer comparison
Sep 30, 2024