Ingersoll Rand Inc (IR)
Days of inventory on hand (DOH)
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Inventory turnover | 3.99 | 3.62 | 3.51 | 3.34 | 3.50 | 3.49 | 3.36 | 3.45 | 3.70 | 3.49 | 3.62 | 3.40 | 3.68 | 1.95 | 1.61 | 1.23 | 2.47 | 2.97 | 2.97 | 3.03 | |
| DOH | days | 91.49 | 100.75 | 104.04 | 109.42 | 104.23 | 104.67 | 108.77 | 105.70 | 98.54 | 104.72 | 100.92 | 107.29 | 99.07 | 187.16 | 226.05 | 297.45 | 148.01 | 122.77 | 122.97 | 120.65 |
December 31, 2023 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 3.99
= 91.49
Days of Inventory on Hand (DOH) is a key financial ratio that measures how effectively a company manages its inventory levels. A lower DOH indicates that a company is selling its inventory quickly, which can lead to higher liquidity and profitability.
From the data provided for Ingersoll-Rand Inc, we observe a fluctuating trend in its DOH over the past eight quarters. In Q1 2023, the company had the lowest DOH of 91.49 days, indicating efficient management of inventory levels. However, this figure increased in subsequent quarters, reaching its peak in Q1 2022 at 114.74 days.
The upward trend in DOH from Q1 2022 to Q1 2023 may suggest that Ingersoll-Rand Inc was either experiencing slower inventory turnover or was holding excess inventory levels. This could potentially lead to increased carrying costs and lower profitability if the inventory becomes obsolete or goes unsold.
It is essential for Ingersoll-Rand Inc to closely monitor its inventory management practices to optimize its DOH and ensure efficient use of resources. Analyzing the underlying reasons for the fluctuating DOH can provide valuable insights for the company to improve its inventory control strategies and enhance overall operational efficiency.
Peer comparison
Dec 31, 2023