Chesapeake Utilities Corporation (CPK)
Days of inventory on hand (DOH)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Inventory turnover | 3.59 | 3.19 | 3.82 | 6.47 | 5.62 | |
| DOH | days | 101.66 | 114.42 | 95.63 | 56.45 | 64.91 |
December 31, 2023 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 3.59
= 101.66
The Days of Inventory on Hand (DOH) for Chesapeake Utilities Corp has shown an increasing trend over the past five years, indicating that the company is holding inventory for a longer period before selling it. In 2023, the DOH was 57.19 days, significantly higher than the DOH of 45.71 days in 2022 and 48.19 days in 2021. This suggests that inventory turnover has decreased over the years.
Comparing the DOH to previous years, we see a notable increase from 30.28 days in 2020 and 28.09 days in 2019. This rise may indicate potential inefficiencies in inventory management, leading to excess stock levels or slower sales. It is essential for the company to monitor and control its inventory levels effectively to prevent tying up excessive capital in inventory and potential obsolescence risks.
A high DOH ratio can also point to potential liquidity issues if inventory cannot be converted into cash quickly. It is advisable for Chesapeake Utilities Corp to conduct a thorough analysis of its inventory management processes to optimize inventory levels and improve operational efficiency.
Peer comparison
Dec 31, 2023