CF Industries Holdings Inc (CF)
Inventory turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 3,880,000 | 4,086,000 | 5,325,000 | 4,151,000 | 3,323,000 |
| Inventory | US$ in thousands | 314,000 | 299,000 | 474,000 | 408,000 | 287,000 |
| Inventory turnover | 12.36 | 13.67 | 11.23 | 10.17 | 11.58 |
December 31, 2024 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $3,880,000K ÷ $314,000K
= 12.36
Inventory turnover is a crucial efficiency ratio that measures how effectively a company manages its inventory. In the case of CF Industries Holdings Inc, the inventory turnover has shown a generally positive trend over the years, starting at 11.58 in 2020 and reaching 12.36 in 2024.
The steady increase in inventory turnover indicates that the company has been able to sell its inventory more quickly in later years, which is a positive sign of operational efficiency. It suggests that the company's inventory management processes have improved, allowing them to convert inventory into sales at a faster pace.
Overall, the consistently increasing inventory turnover of CF Industries Holdings Inc reflects a favorable trend in managing its inventory effectively, thereby potentially reducing holding costs and optimizing working capital utilization.
Peer comparison
Dec 31, 2024