Innovex International, Inc (INVX)

The analysis of Innovex International, Inc.'s days of inventory on hand (DOH) over the period from December 31, 2020, to December 31, 2024, reveals notable fluctuations indicative of changing inventory management and operational circumstances.

At the end of 2020, the company maintained an average of approximately 287.44 days of inventory on hand, suggesting a relatively high level of inventory relative to sales or cost of goods sold during that period. This elevated DOH could point to inventory accumulation strategies, slow-moving inventory, or potential overstocking issues.

In 2021, the DOH experienced a significant decline to approximately 162.39 days, nearly halving the previous year's figure. This sharp reduction indicates an improvement in inventory turnover, likely due to enhanced inventory management practices, increased sales, or both. The company was able to reduce its inventory holding period substantially, which generally correlates with increased operational efficiency and improved liquidity.

The trend continued modestly into 2022, with DOH slightly decreasing to around 160.88 days. This stabilization at a lower level suggests that the company successfully maintained improved inventory turnover rates established in the prior year. It could reflect ongoing optimization of supply chain and inventory processes.

However, from 2022 onward, a reversal trend is observed. By the end of 2023, the DOH increased to approximately 230.12 days, marking a notable rise from the previous year. This escalation indicates that inventory levels began to accumulate again, potentially due to slower sales, challenges in demand forecasting, supply chain disruptions, or strategic inventory buildup.

In 2024, the DOH remained relatively stable, marginally increasing to approximately 231.16 days. The minimal change suggests a stabilization of inventory practices but continues to reflect a higher inventory holding period compared to the 2021 and 2022 levels.

Overall, the data reflects a cycle of initial high inventory levels, subsequent significant improvement towards more efficient inventory management, followed by a period of inventory accumulation. These fluctuations can have implications for the company's working capital management, liquidity, and operational efficiency, highlighting the importance of closely monitoring demand trends and supply chain factors to optimize inventory levels going forward.

Peer comparison

Dec 31, 2024