CVS Health Corp (CVS)
Days of inventory on hand (DOH)
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Inventory turnover | 24.35 | 21.88 | 18.08 | 17.36 | 15.08 | |
| DOH | days | 14.99 | 16.68 | 20.19 | 21.03 | 24.21 |
December 31, 2024 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 24.35
= 14.99
To analyze the Days of Inventory on Hand (DOH) of CVS Health Corp over the years, we observe a downward trend from 24.21 days in December 31, 2020 to 14.99 days in December 31, 2024. This decreasing trend indicates an improvement in the company's efficiency in managing its inventory levels.
A lower DOH value suggests that CVS Health Corp is selling its inventory at a faster rate compared to the previous years, which is a positive indicator of effective inventory management. The decrease in DOH signifies that the company is optimizing its inventory turnover, resulting in reduced holding costs and potential obsolescence risks.
By continuously reducing its DOH, CVS Health Corp is likely streamlining its supply chain, enhancing inventory control procedures, and responding promptly to changing market demands. This trend reflects positively on the company's operational effectiveness and could lead to improved profitability and cash flow in the long term.
Peer comparison
Dec 31, 2024