LKQ Corporation (LKQ)
Days of inventory on hand (DOH)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Inventory turnover | 2.66 | 2.75 | 2.97 | 2.91 | 2.76 | |
| DOH | days | 137.40 | 132.67 | 122.70 | 125.26 | 132.22 |
December 31, 2023 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 2.66
= 137.40
The days of inventory on hand (DOH) for LKQ Corp has shown some fluctuation over the past five years. In 2023, the DOH increased to 137.40 days from 132.67 days in 2022, marking a higher level of inventory held by the company. This could indicate potential issues with inventory management efficiency or an increase in inventory levels relative to sales.
Comparing 2023 to 2021, there has been a noticeable increase in DOH from 122.69 days to 137.40 days. This suggests that LKQ Corp is holding inventory for a longer period, which may tie up working capital and increase storage costs.
Although there was a slight decrease in DOH from 2023 to 2020, the overall trend has been an increase in the number of days it takes to sell inventory. This could indicate a potential need for the company to review and optimize its inventory management processes to improve efficiency and reduce carrying costs.
Furthermore, the DOH in 2023 is higher than the respective figures in 2019 and 2020, indicating a prolonged period of inventory turnover. This may require closer monitoring and strategic adjustments to streamline operations and maintain optimal inventory levels to support sales while minimizing excess holding costs.