Neogen Corporation (NEOG)

Inventory turnover

		May 31, 2025	Feb 28, 2025	Nov 30, 2024	Aug 31, 2024	May 31, 2024	Feb 29, 2024	Nov 30, 2023	Aug 31, 2023	May 31, 2023	Feb 28, 2023	Nov 30, 2022	Aug 31, 2022	May 31, 2022	Feb 28, 2022	Nov 30, 2021	Aug 31, 2021	May 31, 2021	Feb 28, 2021	Nov 30, 2020	Aug 31, 2020
Cost of revenue (ttm)	US$ in thousands	473,285	463,993	465,207	460,134	460,322	455,638	454,000	458,639	416,492	372,958	333,499	285,928	284,146	278,786	270,814	262,677	253,403	241,014	232,693	227,684
Inventory	US$ in thousands	190,859	205,442	198,267	198,596	189,267	182,390	160,529	140,692	133,812	143,863	136,069	129,039	122,313	113,395	107,086	102,109	100,701	99,267	92,529	97,573
Inventory turnover		2.48	2.26	2.35	2.32	2.43	2.50	2.83	3.26	3.11	2.59	2.45	2.22	2.32	2.46	2.53	2.57	2.52	2.43	2.51	2.33

May 31, 2025 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $473,285K ÷ $190,859K
= 2.48

The inventory turnover ratios for Neogen Corporation over the specified periods reveal fluctuations indicative of the company's inventory management efficiency. Initially, the ratio was 2.33 as of August 31, 2020, and it demonstrated a gradual upward trend through much of 2020 and 2021, reaching a peak of 2.57 on August 31, 2021. This increase suggests an improvement in how effectively the company sold through its inventory during this period.

Subsequently, the ratio experienced slight declines and stability, with values such as 2.53 on November 30, 2021, and 2.46 on February 28, 2022, indicating a minor reduction in inventory turnover efficiency. The ratio further decreased to 2.32 as of May 31, 2022, and reached a low of 2.22 on August 31, 2022, suggesting a period of relatively slower inventory turnover.

From late 2022 onward, there was a notable uptick, with the ratio increasing to 2.45 on November 30, 2022, and then further improving to 2.59 on February 28, 2023. A significant rise was observed as of May 31, 2023, reaching 3.11, and it continued to improve to 3.26 by August 31, 2023. These increases may reflect enhanced inventory management or increased sales activity during this interval.

After August 2023, the ratio declined somewhat to 2.83 on November 30, 2023, before again decreasing to 2.50 in February 2024, and subsequently to 2.43, 2.32, 2.35, and 2.26 for the periods ending May 31, 2024; August 31, 2024; November 30, 2024; and February 28, 2025, respectively. The most recent data suggests a stabilization at around 2.3, indicating a consistent but moderate pace of inventory turnover.

Overall, the evaluation of these ratios shows periods of improvement and decline, reflecting adjustments in inventory management strategies, sales performance, or supply chain dynamics. The recent trend indicates a modest but stable inventory turnover rate close to past levels, which may imply a balanced inventory approach aligned with the company's operational environment.