FormFactor Inc (FORM)
Days of inventory on hand (DOH)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Inventory turnover | 4.89 | 4.94 | 5.33 | 5.53 | 5.84 | |
| DOH | days | 74.63 | 73.84 | 68.42 | 66.00 | 62.53 |
December 31, 2023 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 4.89
= 74.63
FormFactor Inc's days of inventory on hand (DOH) have shown an increasing trend over the past five years, reflecting a potential difficulty in managing inventory levels efficiently. The company's inventory turnover has been decreasing gradually, with DOH rising from 62.53 days in 2019 to 74.63 days in 2023.
A high DOH may indicate slow inventory turnover, which could lead to excess or obsolete inventory, tying up valuable working capital. It may also suggest potential inefficiencies in production, procurement, or demand forecasting processes.
Management should closely monitor and evaluate the reasons behind the increasing DOH trend, seeking opportunities to streamline inventory management, improve demand planning, and optimize production processes to ensure a more efficient allocation of resources and enhance overall operational performance.
Peer comparison
Dec 31, 2023