Mesa Laboratories Inc (MLAB)

Days of inventory on hand (DOH)

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	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
Inventory turnover		3.47	3.18	2.94	2.71	2.31	2.57	2.41	2.46	2.57	3.26	3.04	3.06	2.73	4.30	4.13	4.23	4.15	4.49	4.08	3.71
DOH	days	105.14	114.73	124.29	134.89	158.23	142.14	151.38	148.08	141.93	112.08	120.14	119.36	133.80	84.80	88.44	86.27	87.99	81.38	89.55	98.46

December 31, 2024 calculation

DOH = 365 ÷ Inventory turnover
= 365 ÷ 3.47
= 105.14

Days of inventory on hand (DOH) measures how many days, on average, a company holds inventory before selling it. In the case of Mesa Laboratories Inc, the trend in DOH from March 31, 2020, to December 31, 2024, shows some fluctuations.

The DOH decreased from 98.46 days on March 31, 2020, to a low of 81.38 days on September 30, 2020, indicating a more efficient management of inventory during that period. However, the DOH increased subsequently, reaching 133.80 days on December 31, 2021, and peaking at 158.23 days on December 31, 2023.

The significant increase in DOH may suggest potential problems such as overstocking, declining sales, or inefficiencies in inventory management. It is important for Mesa Laboratories Inc to address these issues to avoid tying up excess capital in inventory and potentially risking obsolescence.

The decrease in DOH observed in the last two quarters of the data, reaching 105.14 days on December 31, 2024, may indicate efforts to improve inventory turnover. However, the company should continue monitoring its inventory levels closely to strike a balance between meeting customer demand and optimizing working capital efficiency.