Hilton Grand Vacations Inc (HGV)
Inventory turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 531,000 | 421,000 | 401,000 | 398,000 | 201,000 |
| Inventory | US$ in thousands | 1,400,000 | 1,159,000 | 0 | 0 | 0 |
| Inventory turnover | 0.38 | 0.36 | — | — | — |
December 31, 2023 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $531,000K ÷ $1,400,000K
= 0.38
Hilton Grand Vacations Inc's inventory turnover has fluctuated over the past five years, ranging from a low of 0.04 in 2020 to a high of 0.23 in 2022. Inventory turnover measures the number of times a company sells and replaces its inventory within a specific period. A higher inventory turnover ratio generally indicates that the company is efficiently managing its inventory levels and selling products effectively.
The significant decrease in inventory turnover in 2020 to 0.04 may suggest potential issues such as excess inventory, slow-moving products, or inadequate sales. However, the subsequent increase in 2022 to 0.23 indicates improvements and more efficient inventory management practices.
The inventory turnover ratio of 0.14 in 2023 indicates that Hilton Grand Vacations Inc is turning over its inventory approximately 0.14 times during the year. This implies that the company is selling and replacing its inventory at a moderate pace, but there may be room for further enhancement in inventory management efficiency to optimize the use of resources and maximize profitability.