ProPetro Holding Corp (PUMP)

Inventory turnover

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	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
Cost of revenue (ttm)	US$ in thousands	1,277,247	1,309,254	1,333,659	1,360,972	1,338,882	1,292,688	1,200,964	1,100,559	1,010,927	954,420	922,106	867,911	795,642	726,249	641,087	553,373	741,262	934,915	1,232,431	1,545,765
Inventory	US$ in thousands	16,162	16,743	18,742	19,447	17,705	15,887	18,159	17,732	5,034	3,944	3,491	2,297	3,949	3,477	2,641	2,329	2,729	1,849	2,805	2,436
Inventory turnover		79.03	78.20	71.16	69.98	75.62	81.37	66.14	62.07	200.82	241.99	264.14	377.85	201.48	208.87	242.74	237.60	271.62	505.63	439.37	634.55

December 31, 2024 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $1,277,247K ÷ $16,162K
= 79.03

ProPetro Holding Corp's inventory turnover ratio has shown fluctuating trends over the years based on the provided data. The inventory turnover ratio measures how efficiently a company manages its inventory by indicating how many times the inventory is sold and replaced during a specific period.

Between March 31, 2020, and December 31, 2024, ProPetro's inventory turnover ratio ranged from a high of 634.55 to a low of 62.07. The trend shows a general decline in the inventory turnover ratio over time, indicating potential inefficiencies in managing inventory or changes in the company's sales patterns.

A high inventory turnover ratio, such as the one seen on March 31, 2020, suggests that ProPetro was selling and restocking its inventory rapidly. Conversely, a low inventory turnover ratio, like the one observed on March 31, 2023, indicates that the company was holding onto its inventory for a longer period before selling it.

The decreasing trend in the inventory turnover ratio may raise concerns about the company's inventory management practices, potential overstocking, or slow-moving inventory. It could also imply changes in the demand for ProPetro's products or delays in the production process.

Overall, analyzing ProPetro Holding Corp's inventory turnover ratio provides insights into the company's inventory management efficiency and can help identify areas for improvement to enhance operational performance and profitability.