Cleveland-Cliffs Inc (CLF)
Inventory turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 21,450,000 | 21,111,000 | 16,474,000 | 5,511,000 | 1,414,300 |
| Inventory | US$ in thousands | 4,460,000 | 5,130,000 | 5,188,000 | 3,828,000 | 317,000 |
| Inventory turnover | 4.81 | 4.12 | 3.18 | 1.44 | 4.46 |
December 31, 2023 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $21,450,000K ÷ $4,460,000K
= 4.81
Cleveland-Cliffs Inc's inventory turnover ratio has shown fluctuating trends over the past five years, indicating varying efficiency in managing its inventory. The inventory turnover ratio measures how many times a company sells and replaces its inventory within a given period.
In 2023, the inventory turnover ratio improved to 4.62, up from 3.99 in 2022, suggesting that the company was more efficient in selling and replenishing its inventory during that year. This increase can be a positive sign of effective inventory management, potentially resulting in reduced carrying costs and better utilization of resources.
The significant improvement in inventory turnover from 1.33 in 2020 to 4.62 in 2023 is particularly noteworthy. This indicates a substantial enhancement in the company's ability to turn its inventory into sales, which could lead to increased profitability and liquidity.
Overall, while the inventory turnover ratio has shown fluctuations in recent years, the upward trend seen in 2023 is a positive indicator of Cleveland-Cliffs Inc's improved inventory management efficiency. It would be important for the company to sustain this positive trend in the future to optimize its operations and financial performance.
Peer comparison
Dec 31, 2023