Patterson-UTI Energy Inc (PTEN)
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 | 315,167 | 233,592 | 135,385 | 120,849 | 119,956 | 150,739 | 148,024 | 149,166 | 145,230 | 115,237 | 116,811 | 118,299 | 523,374 | 527,174 | 556,850 | 566,153 | 171,549 | 380,247 | 359,936 | 362,656 |
| Inventory | US$ in thousands | 180,805 | 186,514 | 68,036 | 65,275 | 65,377 | 55,216 | 53,528 | 45,302 | 42,359 | 34,924 | 33,763 | 34,369 | 33,085 | 33,693 | 34,977 | 34,142 | 36,357 | 37,334 | 68,611 | 65,871 |
| Inventory turnover | 1.74 | 1.25 | 1.99 | 1.85 | 1.83 | 2.73 | 2.77 | 3.29 | 3.43 | 3.30 | 3.46 | 3.44 | 15.82 | 15.65 | 15.92 | 16.58 | 4.72 | 10.19 | 5.25 | 5.51 |
December 31, 2023 calculation
Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $315,167K ÷ $180,805K
= 1.74
Patterson-UTI Energy Inc's inventory turnover has shown variability over the past eight quarters. The inventory turnover ratio measures how efficiently a company manages its inventory by indicating how many times inventory is sold and replaced during a specific period.
The trend reveals an overall improvement in inventory turnover from Q3 2022 to Q2 2023, with a peak in Q1 2023 at 29.42 times. This high turnover rate indicates that the company is adept at managing its inventory levels to meet customer demand promptly. However, the drop in Q3 and Q4 2023, compared to the peak, suggests a potential slowdown in sales or potential overstocking of inventory during these quarters.
Generally, a higher inventory turnover ratio is preferable as it signifies that inventory is being sold quickly, reducing holding costs and the risk of obsolescence. Conversely, a low turnover ratio could indicate overstocking, poor sales, or obsolete inventory.
Further analysis would be beneficial to understand the factors driving the fluctuation in Patterson-UTI Energy Inc's inventory turnover and to determine whether adjustments need to be made to optimize inventory management and improve operational efficiency.
Peer comparison
Dec 31, 2023
Dec 31, 2023