Murphy Oil Corporation (MUR)

Inventory turnover

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
Cost of revenue (ttm) US$ in thousands 2,129,620 1,665,825 1,669,749 1,561,875 1,484,406 1,965,205 1,979,526 1,941,169 1,840,861 1,700,268 1,552,592 1,514,862 1,521,679 1,541,777 1,574,668 1,588,451 1,759,714 1,939,072 2,069,155 2,053,409
Inventory US$ in thousands 54,858 51,048 51,811 49,662 54,454 60,435 62,450 63,500 54,500 53,265 63,886 59,339 54,198 57,411 57,116 66,585 66,076 67,856 59,728 68,348
Inventory turnover 38.82 32.63 32.23 31.45 27.26 32.52 31.70 30.57 33.78 31.92 24.30 25.53 28.08 26.86 27.57 23.86 26.63 28.58 34.64 30.04

December 31, 2024 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $2,129,620K ÷ $54,858K
= 38.82

Murphy Oil Corporation's inventory turnover has fluctuated over the years based on the provided data. The inventory turnover ratio indicates how efficiently the company manages its inventory by measuring how many times the company sells and replaces its inventory over a specific period.

From March 31, 2020, to December 31, 2024, the inventory turnover ratio varied, starting at 30.04 and peaking at 38.82 in December 31, 2024. Generally, a higher inventory turnover ratio indicates that the company is selling goods more quickly, which is favorable as it reduces the risk of obsolete inventory and improves cash flow. On the other hand, a lower ratio could suggest overstocking or slow sales which may tie up capital.

Murphy Oil Corporation experienced some fluctuations in its inventory turnover, with peaks and troughs in the ratio. It is essential for the company to monitor and analyze these changes to ensure optimal inventory management practices. A consistent and appropriate inventory turnover ratio can help the company maintain healthy operations and financial performance.