Eastman Chemical Company (EMN)
Inventory turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 7,092,000 | 7,149,000 | 8,443,000 | 7,976,000 | 6,498,000 |
| Inventory | US$ in thousands | 1,988,000 | 1,683,000 | 1,894,000 | 1,504,000 | 1,379,000 |
| Inventory turnover | 3.57 | 4.25 | 4.46 | 5.30 | 4.71 |
December 31, 2024 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $7,092,000K ÷ $1,988,000K
= 3.57
The inventory turnover for Eastman Chemical Company has fluctuated over the past five years. It stood at 4.71 in December 31, 2020, and showed an improvement to 5.30 by December 31, 2021. However, there was a slight decrease in the inventory turnover to 4.46 by December 31, 2022, followed by a further decline to 4.25 by December 31, 2023. The trend continued with another drop to 3.57 by December 31, 2024.
A higher inventory turnover ratio indicates that the company is efficiently managing its inventory by selling and replenishing stock quickly. Conversely, a lower ratio may suggest overstocking, obsolete inventory, or difficulties in selling products.
Eastman Chemical Company should carefully monitor its inventory levels and sales to optimize its operations and maintain a healthy balance between inventory management and sales performance. Further analysis of the underlying factors impacting inventory turnover, such as production efficiency, demand forecasting, and supply chain management, would be beneficial in understanding the dynamics driving these fluctuations.
Peer comparison
Dec 31, 2024