Flowserve Corporation (FLS)
Days of inventory on hand (DOH)
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Inventory turnover | 3.73 | 3.44 | 3.26 | 3.67 | 3.91 | |
| DOH | days | 97.84 | 106.25 | 111.86 | 99.37 | 93.26 |
December 31, 2024 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 3.73
= 97.84
Flowserve Corporation's days of inventory on hand (DOH) has shown a fluctuating trend over the past five years. The DOH was 93.26 days at the end of December 31, 2020, increased to 99.37 days by December 31, 2021, and further elevated to 111.86 days by December 31, 2022. However, there was a slight decrease in DOH to 106.25 days by the end of December 31, 2023, and a further decline to 97.84 days by December 31, 2024.
The increasing trend in DOH from 2020 to 2022 might indicate that Flowserve Corporation was carrying more inventory relative to its sales during those years. This could tie up more working capital and increase the risk of obsolescence. The subsequent decline in DOH in 2023 and 2024 suggests that Flowserve may have implemented better inventory management practices, leading to a more efficient use of inventory.
Overall, it is essential for Flowserve Corporation to strike a balance in managing its inventory levels to ensure optimal working capital utilization and reduce the risk of excess inventory holding costs. Tracking DOH over time can provide insights into the company's inventory management efficiency and operational performance.
Peer comparison
Dec 31, 2024