Gentex Corporation (GNTX)

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	1,690,013	1,699,630	1,678,992	1,683,964	1,668,924	1,619,696	1,580,066	1,506,931	1,437,244	1,373,630	1,282,009	1,236,355	1,225,824	1,263,278	1,289,668	1,198,318	1,195,098	1,161,258	1,173,512	1,278,288
Inventory	US$ in thousands	436,497	449,311	463,492	436,537	402,473	395,453	390,026	401,770	404,360	418,286	392,578	362,737	316,267	292,600	263,900	233,060	226,292	233,358	259,728	251,006
Inventory turnover		3.87	3.78	3.62	3.86	4.15	4.10	4.05	3.75	3.55	3.28	3.27	3.41	3.88	4.32	4.89	5.14	5.28	4.98	4.52	5.09

December 31, 2024 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $1,690,013K ÷ $436,497K
= 3.87

Gentex Corporation's inventory turnover has displayed fluctuations over the reporting periods. The inventory turnover ranged from a high of 5.28 in December 2020 to a low of 3.27 in June 2022. A higher turnover ratio indicates that inventory is selling more quickly, which is generally more favorable as it implies efficient inventory management and reduced carrying costs.

The downward trend in inventory turnover from December 2021 to December 2024, with the ratio declining from 3.88 to 3.87, suggests a longer period for the company to sell its inventory. Analyzing the trend, this may indicate potential issues such as overstocking, slowing sales, or inefficiencies in production and sales processes.

It is important for Gentex Corporation to closely monitor its inventory turnover ratio and take proactive measures to optimize inventory levels, streamline operations, and enhance sales efforts to maintain healthy inventory turnover rates over time.