CTS Corporation (CTS)

Days of inventory on hand (DOH)

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Inventory turnover		6.10	5.99	6.04	6.63	6.21
DOH	days	59.87	60.94	60.39	55.04	58.75

December 31, 2024 calculation

DOH = 365 ÷ Inventory turnover
= 365 ÷ 6.10
= 59.87

To analyze CTS Corporation's Days of Inventory on Hand (DOH) over the five-year period, it is observed that:

1. In December 31, 2020, the DOH was 58.75 days. This indicates that, on average, CTS Corporation held its inventory for approximately 58.75 days before selling it.

2. By December 31, 2021, the DOH had decreased to 55.04 days, suggesting an improvement in inventory turnover efficiency. A lower DOH signifies that the company was able to sell its inventory more quickly.

3. However, in the subsequent years, the DOH increased again: it was 60.39 days in December 31, 2022, 60.94 days in December 31, 2023, and 59.87 days in December 31, 2024. These higher figures indicate a longer period of time that inventory was held before being sold.

4. Overall, the fluctuation in DOH over the years may suggest variations in inventory management efficiency. It is important for CTS Corporation to analyze the reasons behind these changes and strive for a balance between maintaining adequate inventory levels to meet demand and avoiding excess inventory that ties up resources.

5. Further examination of the factors influencing inventory turnover, such as demand forecasting accuracy, supply chain efficiency, and production processes, would be beneficial for CTS Corporation to optimize its inventory management practices and enhance overall operational performance.