PACCAR Inc (PCAR)

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	969,000	933,400	902,600	878,000	834,400	839,900	846,800	878,900	947,000	992,300	1,048,800	1,060,300	1,099,800	1,113,400	1,118,500	1,137,000	1,105,300	1,108,500	1,089,100	1,096,100
Inventory	US$ in thousands	2,576,700	2,622,400	2,712,900	2,609,200	2,198,800	2,382,100	2,232,200	2,222,100	1,976,000	2,516,700	2,054,600	1,465,400	1,221,900	1,124,500	1,136,400	1,270,100	1,153,200	1,292,600	1,336,600	1,272,600
Inventory turnover		0.38	0.36	0.33	0.34	0.38	0.35	0.38	0.40	0.48	0.39	0.51	0.72	0.90	0.99	0.98	0.90	0.96	0.86	0.81	0.86

December 31, 2023 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $969,000K ÷ $2,576,700K
= 0.38

Paccar Inc.'s inventory turnover ratio has shown consistency and improvement over the past eight quarters. Inventory turnover measures how efficiently a company is managing its inventory by indicating how many times in a given period the company sells and replaces its inventory.

Paccar's inventory turnover ratio has ranged from 8.88 to 10.60 over the past two years. The higher the inventory turnover ratio, the better, as it indicates that the company is selling its inventory quickly and efficiently.

In the most recent quarter, Q4 2023, Paccar's inventory turnover was 10.45, indicating that the company sold and replaced its inventory approximately 10.45 times during that quarter. This is a slight decrease from the previous quarter but still remains at a healthy level.

Overall, Paccar has maintained a consistent and strong inventory turnover ratio, reflecting efficient management of its inventory levels. This trend is positive as it suggests that the company is effectively managing its supply chain and inventory costs.