NewMarket Corporation (NEU)

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	2,081,429	2,117,750	2,197,461	2,275,184	2,273,602	2,239,242	2,180,023	2,060,195	1,959,327	1,869,408	1,726,875	1,592,262	1,564,716	1,578,051	1,629,460	1,707,550	1,714,169	1,712,865	1,741,412	1,809,415
Inventory	US$ in thousands	456,234	503,411	537,380	566,136	631,383	592,222	530,186	524,091	498,539	479,039	457,957	414,737	401,031	370,104	354,821	371,002	365,938	370,934	376,481	395,660
Inventory turnover		4.56	4.21	4.09	4.02	3.60	3.78	4.11	3.93	3.93	3.90	3.77	3.84	3.90	4.26	4.59	4.60	4.68	4.62	4.63	4.57

December 31, 2023 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $2,081,429K ÷ $456,234K
= 4.56

The inventory turnover ratio for NewMarket Corp. has exhibited varying levels over the past eight quarters, ranging from 3.36 to 4.22. The trend indicates that the company has been effectively managing its inventory levels, with a higher ratio suggesting efficient utilization of inventory.

Compared to the previous quarters, the inventory turnover ratio has generally been on an upward trend, peaking at 4.22 in Q4 2023. This suggests that the company has been more successful at selling through its inventory in a shorter period.

Overall, a consistently high inventory turnover ratio indicates that NewMarket Corp. is efficient in managing its inventory levels and converting it into sales. This can lead to lower storage costs, reduced risk of obsolescence, and improved cash flow through quicker inventory turnover.