Lincoln Electric Holdings Inc (LECO)
Inventory turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 3,499,770 | 2,480,450 | 2,165,580 | 1,784,060 | 1,995,680 |
| Inventory | US$ in thousands | 562,864 | 665,451 | 539,919 | 381,258 | 393,748 |
| Inventory turnover | 6.22 | 3.73 | 4.01 | 4.68 | 5.07 |
December 31, 2023 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $3,499,770K ÷ $562,864K
= 6.22
The inventory turnover of Lincoln Electric Holdings, Inc. has shown fluctuations over the past five years.
In 2019, the inventory turnover was at its highest, standing at 5.07, indicating that the company's inventory was sold and replaced over five times during the year. This suggests efficient inventory management and good sales performance.
Subsequently, there was a decrease in inventory turnover to 4.68 in 2020, followed by a slight increase to 4.01 in 2021. This could indicate a possible slowdown in sales compared to inventory levels.
In 2022, the inventory turnover further decreased to 3.73, indicating that the company took longer to sell and replace its inventory during the year, possibly due to various factors such as changing consumer demand or supply chain issues.
However, there was an improvement in 2023 with the inventory turnover increasing to 4.84, suggesting that the company may have streamlined its inventory management processes or experienced stronger sales performance.
Overall, it is important for Lincoln Electric Holdings, Inc. to continue monitoring and managing its inventory turnover to ensure optimal efficiency in inventory utilization and sales performance.
Peer comparison
Dec 31, 2023