Louisiana-Pacific Corporation (LPX)
Inventory turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 2,109,000 | 1,988,000 | 2,356,000 | 1,952,000 | 1,566,000 |
| Inventory | US$ in thousands | 357,000 | 378,000 | 337,000 | 278,000 | 259,000 |
| Inventory turnover | 5.91 | 5.26 | 6.99 | 7.02 | 6.05 |
December 31, 2024 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $2,109,000K ÷ $357,000K
= 5.91
Louisiana-Pacific Corporation's inventory turnover has been fairly steady over the past five years, fluctuating between 5.26 and 7.02. The inventory turnover ratio measures how efficiently the company manages its inventory by showing how many times the company sells and replaces its inventory over a period.
In 2021, the inventory turnover ratio improved to 7.02, indicating that the company was able to sell and replace its inventory more frequently compared to the previous year. This could suggest better inventory management practices, such as more accurate forecasting or tighter control on inventory levels.
However, in 2023, the inventory turnover ratio dropped to 5.26, signaling a decrease in the frequency of inventory turnover. This may indicate that the company had excess inventory or faced challenges in selling its products efficiently during that period.
Overall, Louisiana-Pacific Corporation's inventory turnover ratio demonstrates some fluctuations over the years, and it is crucial for the company to continuously monitor and optimize its inventory management to maintain a healthy balance between inventory levels and sales performance.
Peer comparison
Dec 31, 2024