Installed Building Products Inc (IBP)
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 | 1,968,000 | 1,955,400 | 1,915,971 | 1,878,896 | 1,858,683 | 1,841,977 | 1,875,443 | 1,875,858 | 1,842,060 | 1,750,367 | 1,606,409 | 1,482,581 | 1,379,131 | 1,308,271 | 1,243,231 | 1,173,819 | 1,143,251 | 1,117,903 | 1,107,426 | 1,105,183 |
| Inventory | US$ in thousands | 194,600 | 182,300 | 175,600 | 171,100 | 162,800 | 159,675 | 163,378 | 170,115 | 176,629 | 182,176 | 192,387 | 160,023 | 143,039 | 118,093 | 99,482 | 85,980 | 77,179 | 70,218 | 69,149 | 73,569 |
| Inventory turnover | 10.11 | 10.73 | 10.91 | 10.98 | 11.42 | 11.54 | 11.48 | 11.03 | 10.43 | 9.61 | 8.35 | 9.26 | 9.64 | 11.08 | 12.50 | 13.65 | 14.81 | 15.92 | 16.02 | 15.02 |
December 31, 2024 calculation
Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $1,968,000K ÷ $194,600K
= 10.11
Installed Building Products Inc's inventory turnover has shown a declining trend over the past few years, which may indicate inefficiencies in managing and selling inventory. The inventory turnover ratio measures how many times a company's inventory is sold and replaced during a specific period. A higher turnover ratio generally indicates that the company is selling its inventory quickly and efficiently.
From March 2020 to December 2024, the inventory turnover ratio has decreased from 15.02 to 10.11. This suggests that the company is taking longer to sell its inventory, which could potentially tie up capital in slow-moving stock or obsolete items.
The decreasing trend in inventory turnover could signal potential issues such as overstocking, poor demand forecasting, or inefficient inventory management processes. Management should closely monitor and address these issues to optimize inventory levels, improve cash flow, and enhance overall operational efficiency.
It is advisable for Installed Building Products Inc to conduct a thorough review of its inventory management strategies and implement measures to improve inventory turnover rates in order to enhance profitability and maintain competitiveness in the market.
Peer comparison
Dec 31, 2024
Dec 31, 2024