PulteGroup Inc (PHM)

Inventory turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cost of revenue	US$ in thousands	1,479,700	1,585,450	1,303,260	1,138,320	1,152,540
Inventory	US$ in thousands	11,474,900	11,326,000	9,047,570	7,721,800	7,680,610
Inventory turnover		0.13	0.14	0.14	0.15	0.15

December 31, 2023 calculation

Inventory turnover = Cost of revenue ÷ Inventory
= $1,479,700K ÷ $11,474,900K
= 0.13

The inventory turnover ratio measures the efficiency of a company in managing its inventory. A higher inventory turnover ratio indicates that a company is selling its inventory quickly, which is generally seen as a positive sign.

Looking at the trend for PulteGroup Inc over the past five years, we can observe some fluctuations in the inventory turnover ratio. In 2023, the inventory turnover ratio decreased to 0.96 from 1.01 in 2022, indicating that the company's inventory took longer to sell during the year. This decrease in inventory turnover may be a cause for further investigation into the company's inventory management practices.

Comparing the 2023 ratio to the ratios in 2021, 2020, and 2019, we see a declining trend in inventory turnover since 2021 when the ratio was 1.12. This suggests that PulteGroup Inc may be experiencing challenges in efficiently managing its inventory levels and turning inventory into sales.

It is important for investors and analysts to closely monitor changes in inventory turnover ratios as they can provide valuable insights into a company's operational efficiency and overall financial health. Further analysis of PulteGroup Inc's inventory turnover ratio along with other financial metrics and industry benchmarks would be beneficial in gaining a comprehensive understanding of the company's performance.