Haverty Furniture Companies Inc (HVT)
Inventory turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 794,853 | 929,288 | 894,441 | 706,546 | 777,674 |
| Inventory | US$ in thousands | 93,956 | 118,333 | 112,031 | 89,908 | 104,817 |
| Inventory turnover | 8.46 | 7.85 | 7.98 | 7.86 | 7.42 |
December 31, 2023 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $794,853K ÷ $93,956K
= 8.46
Haverty Furniture Companies Inc's inventory turnover has exhibited a consistent trend over the past five years, ranging from 7.42 to 8.46. The inventory turnover ratio measures the efficiency of the company in managing its inventory levels. A higher inventory turnover ratio indicates that the company is selling its inventory more quickly, which is generally favorable as it helps in reducing carrying costs and minimizing the risk of inventory obsolescence.
The gradual increase in the inventory turnover ratio from 7.42 in 2019 to 8.46 in 2023 signifies an improvement in the company's inventory management efficiency. This could be attributed to better inventory control, effective demand forecasting, and streamlined inventory replenishment processes. It indicates that Haverty Furniture Companies Inc is efficiently managing its inventory levels to meet customer demand and capitalize on sales opportunities.
Overall, the consistent and relatively high inventory turnover ratios reflect Haverty Furniture Companies Inc's ability to effectively manage its inventory to support sales growth and maintain optimal inventory levels. However, it is essential for the company to continue monitoring and optimizing its inventory turnover ratio to ensure efficient inventory management practices and maximize profitability.
Peer comparison
Dec 31, 2023