PriceSmart Inc (PSMT)

Inventory turnover

		Aug 31, 2024	May 31, 2024	Feb 29, 2024	Nov 30, 2023	Aug 31, 2023	May 31, 2023	Feb 28, 2023	Nov 30, 2022	Aug 31, 2022	May 31, 2022	Feb 28, 2022	Nov 30, 2021	Aug 31, 2021	May 31, 2021	Feb 28, 2021	Nov 30, 2020	Aug 31, 2020	May 31, 2020	Feb 29, 2020	Nov 30, 2019
Cost of revenue (ttm)	US$ in thousands	622,842	611,361	592,389	580,323	565,367	549,414	536,255	520,062	512,959	507,649	503,446	497,434	487,041	1,029,319	1,009,612	999,539	992,443	985,307	985,230	974,260
Inventory	US$ in thousands	528,678	516,464	502,292	529,898	471,407	442,580	449,101	510,060	464,411	460,962	470,313	500,767	389,711	336,645	339,237	373,178	309,509	268,762	323,022	388,072
Inventory turnover		1.18	1.18	1.18	1.10	1.20	1.24	1.19	1.02	1.10	1.10	1.07	0.99	1.25	3.06	2.98	2.68	3.21	3.67	3.05	2.51

August 31, 2024 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $622,842K ÷ $528,678K
= 1.18

The inventory turnover ratio for PriceSmart Inc has fluctuated over the past few years. From November 2019 to February 2022, the ratio ranged between 0.99 and 1.25, indicating that the company was turning over its inventory at a relatively consistent pace. However, there was a significant increase in inventory turnover from May 2022 to May 2023, reaching a peak of 3.06. This spike suggests that PriceSmart was managing its inventory more efficiently during this period.

Subsequently, the inventory turnover ratio decreased in the following periods, stabilizing around 1.18 from August 2023 to August 2024. While the ratio remained relatively steady during these quarters, it is essential to note that a consistent inventory turnover ratio can indicate effective inventory management practices and operational efficiency within the company. Overall, PriceSmart's inventory turnover ratio analysis shows variations over time, reflecting changes in the company's inventory management strategies and sales performance.