Kadant Inc (KAI)
Inventory turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 897,364 | 797,947 | 763,124 | 684,550 | 562,255 |
| Inventory | US$ in thousands | 146,092 | 152,677 | 163,672 | 134,356 | 106,814 |
| Inventory turnover | 6.14 | 5.23 | 4.66 | 5.10 | 5.26 |
December 31, 2024 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $897,364K ÷ $146,092K
= 6.14
Kadant Inc's inventory turnover has shown a fluctuating trend over the past five years. The inventory turnover ratio decreased from 5.26 in December 2020 to 4.66 in December 2022, indicating a longer holding period for the company's inventory. However, there was a slight improvement in inventory turnover to 5.10 in December 2021, followed by a notable increase to 5.23 in December 2023 and a significant rise to 6.14 in December 2024.
The rising trend in inventory turnover from 2022 to 2024 suggests that Kadant Inc is managing its inventory more efficiently and selling its products at a faster pace. A higher inventory turnover ratio generally signifies that the company is effectively replenishing its stock, minimizing carrying costs, and generating higher sales from its inventory.
Overall, the improvement in inventory turnover ratios in recent years reflects positively on Kadant Inc's operational performance and efficiency in managing its inventory levels. However, continued monitoring of this ratio is necessary to ensure optimal inventory management practices are maintained.
Peer comparison
Dec 31, 2024