Lululemon Athletica Inc. (LULU)

Days of inventory on hand (DOH)

		Jan 28, 2024	Oct 29, 2023	Jul 30, 2023	Apr 30, 2023	Jan 29, 2023	Oct 30, 2022	Jul 31, 2022	May 1, 2022	Jan 30, 2022	Oct 31, 2021	Aug 1, 2021	May 2, 2021	Jan 31, 2021	Nov 1, 2020	Aug 2, 2020	May 3, 2020	Feb 2, 2020	Nov 3, 2019	Aug 4, 2019	May 5, 2019
Inventory turnover		5.60	3.36	3.20	3.20	3.32	1.69	1.90	4.11	5.10	2.47	5.54	5.46	5.55	4.28	4.65	4.89	5.96	4.70	5.70	6.07
DOH	days	65.18	108.50	114.17	114.07	109.82	216.43	191.86	88.71	71.61	147.91	65.83	66.80	65.76	85.24	78.50	74.70	61.24	77.72	64.05	60.10

January 28, 2024 calculation

DOH = 365 ÷ Inventory turnover
= 365 ÷ 5.60
= 65.18

Days of Inventory on Hand (DOH) is a key financial ratio used to measure how efficiently a company manages its inventory. A lower DOH value indicates that a company is effectively selling its inventory or has more efficient inventory management.

Analyzing the DOH trend for Lululemon Athletica Inc., we observe fluctuations in the ratio over the past years. In the most recent period, the DOH was 65.18 days, showing an improvement compared to the prior quarter when it was high at 108.50 days. This suggests that in the current period, Lululemon is holding less inventory on hand relative to its sales rate, which can be a positive indicator of efficient inventory management.

Looking back over the historical data, we note significant variations in the DOH ratio, with some quarters showing higher values like 216.43 days and 191.86 days, indicating potential issues with inventory management in those periods. However, it is essential to consider industry norms and seasonality factors when evaluating inventory turnover performance.

Overall, the downward trend in the recent period's DOH ratio for Lululemon Athletica Inc. reflects a positive improvement in its inventory management efficiency. Monitoring this ratio along with other key performance indicators can provide insights into the company's operational effectiveness and future performance in the retail sector.