MGE Energy Inc (MGEE)
Days of inventory on hand (DOH)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Inventory turnover | 0.31 | 0.26 | 0.38 | 0.39 | 0.44 | |
| DOH | days | 1,161.83 | 1,387.29 | 970.84 | 934.55 | 826.48 |
December 31, 2023 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 0.31
= 1,161.83
Based on the data provided, the days of inventory on hand (DOH) for MGE Energy Inc have fluctuated over the past five years. The trend indicates an increasing DOH from 2019 to 2022, peaking at 1,387.29 days in 2022. However, there was a slight decrease in DOH to 1,161.83 days in 2023.
A high DOH can suggest that the company may be carrying excess inventory, which could tie up working capital and lead to increased holding costs. Conversely, a low DOH may indicate efficient inventory management, but could also risk stockouts and lost sales opportunities.
Further analysis and comparison with industry benchmarks would be necessary to determine the effectiveness of MGE Energy Inc's inventory management practices and to assess whether the recent decrease in DOH is a positive trend in optimizing working capital and operational efficiency.