nVent Electric PLC (NVT)
Inventory turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 2,707,200 | 2,414,600 | 2,066,800 | 1,934,400 | 1,844,600 |
| Inventory | US$ in thousands | 441,300 | 346,700 | 321,900 | 235,200 | 244,700 |
| Inventory turnover | 6.13 | 6.96 | 6.42 | 8.22 | 7.54 |
December 31, 2023 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $2,707,200K ÷ $441,300K
= 6.13
nVent Electric plc's inventory turnover has exhibited fluctuations over the past five years. The ratio indicates the number of times the company sells and replenishes its inventory within a given period.
nVent Electric plc's inventory turnover decreased from 5.47 in 2019 to 4.72 in 2021 before slightly increasing to 5.23 in 2022. However, there was a further decline to 4.35 in 2023.
The decreasing trend in inventory turnover may suggest inefficiencies in managing inventory levels or challenges in matching inventory with sales demand. Lower turnover rates could indicate overstocking, slow-moving inventory, or declining sales.
It is essential for nVent Electric plc to monitor and optimize its inventory management practices to improve turnover rates, reduce carrying costs, and enhance overall operational efficiency. Further analysis of the company's supply chain processes and demand forecasting may help identify areas for improvement in inventory turnover.
Peer comparison
Dec 31, 2023