Omnicell Inc (OMCL)
Inventory turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 1,142,980 | 1,260,680 | 993,295 | 806,221 | 768,931 |
| Inventory | US$ in thousands | 110,099 | 147,549 | 119,924 | 96,298 | 108,011 |
| Inventory turnover | 10.38 | 8.54 | 8.28 | 8.37 | 7.12 |
December 31, 2023 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $1,142,980K ÷ $110,099K
= 10.38
The inventory turnover ratio measures how efficiently a company manages its inventory by indicating how many times during a year the company sells and replaces its inventory. Higher inventory turnover ratios generally imply that a company is selling goods quickly and efficiently.
Analyzing Omnicell, Inc.'s inventory turnover over the past five years indicates a positive trend. The inventory turnover ratio has shown a steady increase from 4.26 in 2019 to 5.91 in 2023. This suggests that Omnicell has been improving its inventory management efficiency and selling its inventory at a faster pace over the years.
A higher inventory turnover ratio could suggest that Omnicell is effectively managing its inventory levels, avoiding excessive inventory carrying costs, and potentially reducing the risk of obsolete inventory. It may also indicate strong demand for Omnicell's products, as the company is able to swiftly move its inventory through the sales cycle.
However, it is essential to consider industry benchmarks and compare Omnicell's inventory turnover ratio with its competitors to gain a more comprehensive understanding of its performance. Additionally, analyzing other financial ratios and factors alongside the inventory turnover ratio would provide a more complete picture of Omnicell's overall financial health and operational efficiency.
Peer comparison
Dec 31, 2023