Eaton Corporation PLC (ETN)
Days of inventory on hand (DOH)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Inventory turnover | 3.95 | 4.04 | 4.48 | 5.88 | 5.11 | |
| DOH | days | 92.45 | 90.30 | 81.52 | 62.04 | 71.41 |
December 31, 2023 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 3.95
= 92.45
To analyze Eaton Corporation plc's days of inventory on hand (DOH) over the past five years, we observe a fluctuating trend. In 2023, the DOH increased to 92.45 days from 90.30 days in 2022, indicating that the company held inventory for a longer period before selling it. This may suggest potential inefficiencies in managing inventory levels.
Comparing with 2021 and 2020, where the DOH was 81.52 days and 62.04 days respectively, there has been a notable increase in the holding period of inventory. This could signal a change in inventory management practices or challenges in demand forecasting and production planning.
Although the DOH in 2019 was slightly higher at 71.41 days compared to 2022, 2021, and 2020, the recent increase in 2023 raises concerns about the company's ability to optimize its inventory turnover efficiency. It would be advisable for Eaton Corporation plc to review its inventory management processes to enhance operational effectiveness and cost control.
Peer comparison
Dec 31, 2023