Honeywell International Inc (HON)

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	23,761,000	23,076,000	22,767,000	22,557,000	22,527,000	22,918,000	23,229,000	23,649,000	23,825,000	23,637,000	23,402,000	23,359,000	23,394,000	23,434,000	23,071,000	22,344,000	22,169,000	22,521,000	23,176,000	23,994,000
Inventory	US$ in thousands	6,442,000	6,338,000	6,324,000	6,318,000	6,178,000	6,000,000	5,890,000	5,776,000	5,538,000	5,501,000	5,576,000	5,472,000	5,138,000	4,967,000	4,723,000	4,607,000	4,489,000	4,705,000	4,753,000	4,584,000
Inventory turnover		3.69	3.64	3.60	3.57	3.65	3.82	3.94	4.09	4.30	4.30	4.20	4.27	4.55	4.72	4.88	4.85	4.94	4.79	4.88	5.23

December 31, 2024 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $23,761,000K ÷ $6,442,000K
= 3.69

The inventory turnover ratio for Honeywell International Inc has experienced a gradual decline over the past few years. The ratio was 5.23 as of March 31, 2020, indicating that the company turned over its inventory 5.23 times during that period. However, the ratio has been decreasing consistently, reaching 3.69 by December 31, 2024.

A decreasing inventory turnover ratio may suggest that Honeywell has been less efficient in managing its inventory levels or that its sales have decreased relative to its inventory levels. This could potentially lead to higher carrying costs and excess inventory on hand.

It is important for the company to monitor and address the declining trend in inventory turnover to optimize its working capital and improve overall financial performance. Honeywell may consider implementing strategies to better manage inventory levels, enhance demand forecasting, streamline production processes, or reevaluate its product mix to improve inventory turnover efficiency.