M/I Homes Inc (MHO)

Inventory turnover

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Cost of revenue (ttm)	US$ in thousands	3,457,720	3,657,161	3,628,554	3,622,989	3,494,728	3,353,849	3,287,315	3,248,852	3,228,356	3,120,220	3,092,946	2,913,575	2,728,028	2,523,318	2,290,657	2,154,559	2,010,863	2,003,934	1,936,799	1,882,278
Inventory	US$ in thousands	2,797,150	2,740,530	2,687,010	2,657,410	2,828,600	3,016,740	2,816,260	2,582,550	2,452,430	2,353,140	2,076,470	1,960,530	1,916,610	1,843,410	1,830,810	1,822,530	1,769,510	1,827,070	1,763,480	1,730,790
Inventory turnover		1.24	1.33	1.35	1.36	1.24	1.11	1.17	1.26	1.32	1.33	1.49	1.49	1.42	1.37	1.25	1.18	1.14	1.10	1.10	1.09

December 31, 2023 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $3,457,720K ÷ $2,797,150K
= 1.24

Based on the data provided for MI Homes Inc.'s inventory turnover ratio, it is evident that the company has reported consistently zero inventory turnover across all quarters presented (Q4 2023 to Q1 2022). This indicates that the company has not been effectively managing its inventory levels to generate sales during these periods. A zero inventory turnover ratio suggests that the company is holding onto excess inventory, which can tie up capital, increase storage costs, and potentially lead to obsolete inventory issues.

A lack of inventory turnover can also signify potential difficulties in accurately forecasting demand, inefficient inventory management practices, or challenges in adjusting production levels to align with sales needs. Additionally, a stagnant inventory turnover ratio can impact the company's liquidity, profitability, and overall operational efficiency.

Therefore, it would be crucial for MI Homes Inc. to reevaluate its inventory management strategies, streamline its supply chain processes, closely monitor demand fluctuations, and implement measures to optimize its inventory turnover ratio in order to enhance profitability and operational performance.