Nordson Corporation (NDSN)
Days of inventory on hand (DOH)
| Oct 31, 2024 | Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | ||
|---|---|---|---|---|---|---|
| Inventory turnover | 4.40 | 4.45 | 5.07 | 5.52 | 6.63 | |
| DOH | days | 82.93 | 82.10 | 71.94 | 66.18 | 55.09 |
October 31, 2024 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 4.40
= 82.93
The days of inventory on hand (DOH) for Nordson Corporation have shown a generally increasing trend over the past five years, with figures of 82.93 days in 2024, 82.10 days in 2023, 71.94 days in 2022, 66.18 days in 2021, and 55.09 days in 2020. This indicates that, on average, the company has held inventory for a longer period before selling it.
A higher DOH could suggest that the company is carrying excess inventory or facing challenges in efficiently managing its inventory levels. This may tie up working capital and increase holding costs, potentially impacting profitability. It could also indicate lower inventory turnover and possible obsolescence risks.
Management should closely monitor and analyze the reasons behind the increasing DOH trend to ensure effective inventory management practices and optimize working capital utilization. Additionally, exploring strategies to improve inventory turnover and reduce DOH could enhance operational efficiency and financial performance in the long run.
Peer comparison
Oct 31, 2024