Murphy Oil Corporation (MUR)

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	216,611	260,799	297,168	337,466	354,802	274,990	230,142	184,755	316,976	342,340	566,339	635,644	1,438,893	1,489,883	1,292,429	1,249,276	315,481	447,646	590,040	728,028
Inventory	US$ in thousands	54,454	60,435	62,450	63,539	54,513	53,265	63,886	59,339	54,198	57,411	57,116	66,585	66,076	67,856	59,728	68,348	76,123	79,441	86,701	77,278
Inventory turnover		3.98	4.32	4.76	5.31	6.51	5.16	3.60	3.11	5.85	5.96	9.92	9.55	21.78	21.96	21.64	18.28	4.14	5.63	6.81	9.42

December 31, 2023 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $216,611K ÷ $54,454K
= 3.98

The inventory turnover ratio measures how many times a company's inventory is sold and replaced over a specific period. A higher inventory turnover ratio generally indicates that a company is efficiently managing its inventory levels.

Analyzing Murphy Oil Corp.'s inventory turnover over the past eight quarters, we observe fluctuations in the ratio. In Q1 2022 and Q4 2023, the inventory turnover ratios were the lowest at 0.57 and 0.95, respectively, indicating that the company took longer to sell its inventory during those periods. Conversely, in Q1 2023, the inventory turnover reached its peak at 2.68, suggesting that Murphy Oil Corp. efficiently sold and replaced its inventory during that quarter.

Overall, the trend indicates that Murphy Oil Corp. has experienced variances in managing its inventory levels over the past two years, with some quarters showing strong efficiency in inventory turnover and others exhibiting lower turnover rates. Further analysis and comparisons with industry benchmarks could provide additional insights into the company's inventory management performance.