CarMax Inc (KMX)

Inventory turnover

		Feb 29, 2024	Feb 28, 2023	Feb 28, 2022	Feb 28, 2021	Feb 29, 2020
Cost of revenue	US$ in thousands	23,822,800	26,884,700	28,612,900	16,571,000	17,597,600
Inventory	US$ in thousands	3,678,070	3,726,140	5,124,570	3,157,160	2,846,420
Inventory turnover		6.48	7.22	5.58	5.25	6.18

February 29, 2024 calculation

Inventory turnover = Cost of revenue ÷ Inventory
= $23,822,800K ÷ $3,678,070K
= 6.48

CarMax Inc's inventory turnover ratio has varied over the past five years. The inventory turnover ratio measures how efficiently a company manages its inventory by calculating how many times a company sells and replaces its inventory within a specific period.

In the most recent year, as of Feb 29, 2024, CarMax Inc's inventory turnover ratio was 6.48, indicating that the company turned over its inventory approximately 6.48 times during the fiscal year. This represents a decrease from the previous year's ratio of 7.22.

The downward trend in inventory turnover from 2023 to 2024 may suggest that CarMax Inc is holding onto its inventory for a slightly longer period before selling it, which could tie up capital and impact profitability. However, it is essential to consider the industry norms and the company's specific operations when assessing the significance of this change in inventory turnover.

Overall, CarMax Inc's inventory turnover ratios over the past five years show fluctuations, and further analysis of the company's inventory management practices and industry trends would provide more insights into its operational efficiency and financial performance.