McKesson Corporation (MCK)

Inventory turnover

		Mar 31, 2024	Mar 31, 2023	Mar 31, 2022	Mar 31, 2021	Mar 31, 2020
Cost of revenue	US$ in thousands	305,530,000	272,946,000	263,887,000	244,086,000	229,386,000
Inventory	US$ in thousands	21,100,000	19,691,000	18,702,000	19,246,000	16,734,000
Inventory turnover		14.48	13.86	14.11	12.68	13.71

March 31, 2024 calculation

Inventory turnover = Cost of revenue ÷ Inventory
= $305,530,000K ÷ $21,100,000K
= 14.48

McKesson Corporation's inventory turnover has fluctuated over the past five years, ranging from 12.68 in 2021 to 14.48 in 2024. This ratio indicates how efficiently the company manages its inventory by measuring the number of times inventory is sold and replaced during a specific period. A higher inventory turnover generally signifies that the company is efficiently selling its products and managing its stock levels.

The trend suggests that McKesson has been effectively managing its inventory turnover ratio over the years, with slight variations. The increase in the inventory turnover ratio from 2021 to 2024 indicates that the company has improved its inventory management efficiency during this period.

Overall, the inventory turnover ratios for McKesson Corporation are relatively healthy and suggest effective inventory management practices. However, further analysis in conjunction with other financial ratios and considerations of industry benchmarks would provide a more comprehensive understanding of the company's operational efficiency.