Quaker Chemical Corporation (KWR)
Inventory turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 1,669,880 | 1,762,650 | 1,914,200 | 1,637,340 | 1,385,670 |
| Inventory | US$ in thousands | 227,472 | 233,857 | 284,848 | 264,531 | 187,764 |
| Inventory turnover | 7.34 | 7.54 | 6.72 | 6.19 | 7.38 |
December 31, 2024 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $1,669,880K ÷ $227,472K
= 7.34
To analyze Quaker Chemical Corporation's inventory turnover over the five-year period:
1. Trend Analysis: The inventory turnover ratio measures how efficiently a company manages its inventory. From 2020 to 2024, Quaker Chemical Corporation's inventory turnover fluctuated. It decreased from 7.38 in 2020 to 6.19 in 2021, then increased to 6.72 in 2022, further rose to 7.54 in 2023, and slightly dropped to 7.34 in 2024.
2. Comparative Analysis: Comparing the inventory turnover ratio with industry benchmarks or competitors can provide valuable insights. An inventory turnover ratio above 1 indicates that the company is efficiently managing its inventory. Quaker Chemical Corporation's inventory turnover ratios are consistently above 6 over the period, suggesting effective inventory management.
3. Interpretation: A higher inventory turnover ratio indicates that a company is selling its products quickly and efficiently replenishing its inventory. Quaker Chemical Corporation's inventory turnover ratios support the notion that the company efficiently manages its inventory levels across the years analyzed.
4. Implications: A consistent or increasing inventory turnover ratio can reflect positively on a company's operational efficiency and working capital management. Quaker Chemical Corporation's ability to maintain relatively high inventory turnover ratios demonstrates its capability to minimize excess inventory and control carrying costs.
In conclusion, Quaker Chemical Corporation's inventory turnover ratios show a fluctuating but generally healthy trend over the five-year period, indicating effective inventory management practices by the company.
Peer comparison
Dec 31, 2024