Now Inc (DNOW)

Days of inventory on hand (DOH)

Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Inventory turnover 5.22 4.88 4.28 5.10 5.06
DOH days 69.90 74.80 85.32 71.57 72.06

December 31, 2024 calculation

DOH = 365 ÷ Inventory turnover
= 365 ÷ 5.22
= 69.90

Based on the data provided, Now Inc's days of inventory on hand (DOH) has shown some variability over the past five years.

As of December 31, 2020, the company had an inventory on hand for approximately 72.06 days. This indicates that, on average, it took the company 72.06 days to sell its inventory during that period.

By December 31, 2021, the DOH had slightly decreased to 71.57 days. This could be seen as a positive trend as it suggests that the company was able to manage its inventory more efficiently compared to the previous year.

However, by December 31, 2022, the DOH increased significantly to 85.32 days. This could indicate potential issues such as overstocking or slower sales, which may tie up capital and impact cash flow.

On December 31, 2023, the DOH decreased to 74.80 days, showing some improvement in inventory management compared to the previous year.

Finally, as of December 31, 2024, the DOH decreased further to 69.90 days. This reduction could be a result of better inventory control measures or an uptick in sales.

In conclusion, Now Inc should continue monitoring its DOH to ensure efficient inventory management, optimize working capital, and enhance overall profitability.