Martin Marietta Materials Inc (MLM)

Inventory turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cost of revenue	US$ in thousands	5,343,500	5,267,800	4,587,100	3,868,000	3,943,500
Inventory	US$ in thousands	988,600	873,700	752,600	709,000	690,800
Inventory turnover		5.41	6.03	6.10	5.46	5.71

December 31, 2023 calculation

Inventory turnover = Cost of revenue ÷ Inventory
= $5,343,500K ÷ $988,600K
= 5.41

The inventory turnover ratio for Martin Marietta Materials, Inc. has fluctuated over the past five years, ranging from 4.81 to 5.42. A higher inventory turnover ratio indicates that the company is selling its inventory more efficiently.

In 2022, the inventory turnover ratio was at its peak of 5.42, suggesting that the company was managing its inventory exceptionally well and rapidly converting it into sales. However, in 2023, the ratio decreased slightly to 4.81, indicating a slight decrease in the efficiency of inventory management compared to the previous year.

Overall, Martin Marietta Materials, Inc. has generally maintained a healthy inventory turnover ratio above 4.5 in the past five years, which suggests effective inventory management practices. It is essential for the company to monitor this ratio closely to ensure optimal levels of inventory and efficient sales performance in the future.