DXP Enterprises Inc (DXPE)
Inventory turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 1,562,160 | 1,402,600 | 1,091,560 | 114,256 | 1,216,170 |
| Inventory | US$ in thousands | 103,805 | 101,392 | 100,894 | 97,071 | 129,364 |
| Inventory turnover | 15.05 | 13.83 | 10.82 | 1.18 | 9.40 |
December 31, 2023 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $1,562,160K ÷ $103,805K
= 15.05
The inventory turnover ratio of DXP Enterprises Inc has shown a fluctuating trend over the past five years. In 2023 and 2022, the company achieved inventory turnover ratios of 15.05 and 13.83, respectively, indicating an improvement in managing its inventory levels efficiently. This suggests that DXP Enterprises Inc is selling its inventory at a faster pace compared to the previous years.
In contrast, the inventory turnover ratios were lower in 2021 and 2019, at 10.82 and 9.40 respectively, which may indicate slower sales relative to the levels of inventory held. Significantly, in 2020, the company had a notably low inventory turnover ratio of 1.18, suggesting a potential issue with managing its inventory effectively during that period.
Overall, an increasing inventory turnover ratio year over year signifies that the company is selling its inventory more frequently, which is generally viewed positively as it implies efficient inventory management and liquidity. Conversely, a decreasing ratio may indicate potential issues such as overstocking or slow-moving inventory that could affect profitability and cash flow.
Peer comparison
Dec 31, 2023