ChampionX Corporation (CHX)
Inventory turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 2,618,650 | 2,907,280 | 2,331,720 | 1,490,820 | 754,147 |
| Inventory | US$ in thousands | 521,549 | 542,543 | 542,910 | 430,112 | 211,342 |
| Inventory turnover | 5.02 | 5.36 | 4.29 | 3.47 | 3.57 |
December 31, 2023 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $2,618,650K ÷ $521,549K
= 5.02
Inventory turnover is a key financial ratio that indicates how efficiently a company manages its inventory. ChampionX Corp.'s inventory turnover has shown a fluctuating trend over the past five years. The ratio stood at 3.57 in 2019 and increased to 4.29 in 2021 before further improving to 5.36 in 2022. However, in 2023, the inventory turnover decreased slightly to 5.02, but it still reflects a healthy rate.
A higher inventory turnover ratio generally implies that the company is selling through its inventory quickly, which can be an indicator of strong sales or effective inventory management. This trend suggests that ChampionX Corp. has been able to efficiently manage its inventory levels in recent years.
It is important to note that inventory turnover ratios can vary by industry, so it is beneficial to compare ChampionX Corp.'s ratio with industry benchmarks for a more meaningful analysis. Overall, the recent stability and improvement in ChampionX Corp.'s inventory turnover ratio indicate effective inventory management practices within the company.
Peer comparison
Dec 31, 2023