Ormat Technologies Inc (ORA)

Days of inventory on hand (DOH)

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Inventory turnover		19.73	34.27	23.86	12.15	13.64
DOH	days	18.50	10.65	15.30	30.05	26.76

December 31, 2023 calculation

DOH = 365 ÷ Inventory turnover
= 365 ÷ 19.73
= 18.50

The Days of Inventory on Hand (DOH) for Ormat Technologies Inc has exhibited fluctuating trends over the past five years. In 2023, the DOH increased to 29.07 days from 17.91 days in 2022, indicating that the company is holding inventory for a longer period before it is sold. This could suggest potential inefficiencies in inventory management or challenges in converting inventory into sales quickly.

Comparing to 2021 and 2019, where the DOH was 26.04 days and 26.76 days respectively, the current level in 2023 is higher, reflecting a less favorable position in managing inventory levels efficiently. However, the DOH in 2023 is still lower than in 2020, when it reached 30.05 days, indicating some improvement in inventory turnover.

Overall, a high DOH ratio can tie up capital in inventory and may indicate issues such as overstocking, slowing sales, or difficulties in forecasting demand accurately. It would be essential for Ormat Technologies Inc to closely monitor its inventory levels and implement strategies to optimize inventory turnover to enhance operational efficiency and financial performance.