PACCAR Inc (PCAR)

Days of inventory on hand (DOH)

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Inventory turnover		0.38	0.38	0.48	0.91	0.97
DOH	days	959.69	957.71	762.01	401.65	377.54

December 31, 2023 calculation

DOH = 365 ÷ Inventory turnover
= 365 ÷ 0.38
= 959.69

Paccar Inc.'s days of inventory on hand (DOH) has shown an increasing trend over the past five years, indicating that the company is holding inventory for a longer period before it is sold. In 2019, the DOH stood at 20.46 days, and it has steadily increased to 34.93 days by the end of 2023.

This suggests that Paccar Inc. may be experiencing challenges in efficiently managing its inventory levels or facing slower inventory turnover. A higher DOH can tie up capital in inventory, leading to increased carrying costs and potential obsolescence risks.

It is essential for Paccar Inc. to closely monitor and optimize its inventory management practices to avoid excessive stock levels that could impact profitability and cash flow. Further analysis of the company's inventory turnover ratio and comparison with industry benchmarks could provide additional insights into the efficiency of its inventory management processes.