GATX Corporation (GATX)

Inventory turnover

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020
Cost of revenue (ttm)	US$ in thousands	57,000	471,300	450,900	521,200	593,400	615,300	603,200	617,000	603,000	604,200	593,800	569,500	568,200	842,100	831,600	823,000	822,400	851,200	861,700	869,200
Inventory	US$ in thousands	71,800	—	0	0	74,000	-2,600	-100	0	60,200	—	596,500	-400	52,000	-2,400	-3,200	-4,600	64,300	-6,900	-8,200	-8,300
Inventory turnover		0.79	—	—	—	8.02	—	—	—	10.02	—	1.00	—	10.93	—	—	—	12.79	—	—	—

December 31, 2024 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $57,000K ÷ $71,800K
= 0.79

The inventory turnover ratio is a measure of how efficiently a company manages its inventory by calculating the number of times its inventory is sold and replaced within a specific period. For GATX Corporation, the inventory turnover ratio has shown fluctuating trends over the years.

As of December 31, 2020, the inventory turnover ratio stood at 12.79, indicating that the company's inventory turned over approximately 12.79 times during that period. This was a relatively high turnover rate, suggesting efficient management of inventory.

However, the inventory turnover ratio dropped significantly to 1.00 as of June 30, 2022, signaling a possible slowdown in inventory management efficiency. It is important to note that an inventory turnover ratio of 1.00 implies that the company's entire inventory was sold and replenished once during that period.

Subsequently, the ratio improved to 10.02 by December 31, 2022, reflecting a better performance in inventory turnover. Nevertheless, by December 31, 2024, the ratio further declined to 0.79, indicating a potential concern regarding inventory management efficiency.

Overall, the fluctuating inventory turnover ratios of GATX Corporation highlight the need for continuous monitoring and optimization of inventory management practices to ensure effective utilization of resources and maximize profitability.