Rockwell Automation Inc (ROK)
Inventory turnover
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 7,644,000 | 6,544,300 | 5,847,300 | 5,264,600 | 5,359,200 |
| Inventory | US$ in thousands | 1,404,900 | 1,054,200 | 798,100 | 584,000 | 575,700 |
| Inventory turnover | 5.44 | 6.21 | 7.33 | 9.01 | 9.31 |
September 30, 2023 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $7,644,000K ÷ $1,404,900K
= 5.44
Inventory turnover measures the efficiency of a company in managing its inventory. It is calculated by dividing the cost of goods sold (COGS) by the average inventory for a specific period. Rockwell Automation Inc's inventory turnover has shown a declining trend over the last five years. In 2023, the inventory turnover was 3.80, down from 4.42 in 2022 and 5.14 in 2021. This suggests that, on average, the company's inventory is being sold at a slower rate compared to previous years.
A decreasing inventory turnover can indicate inefficient inventory management, overstocking, or slowing sales. It may also point to potential obsolescence or slower-moving inventory, which could tie up the company's resources. Given the declining trend, Rockwell Automation Inc may need to review its inventory management practices to improve efficiency and avoid potential write-downs or losses associated with stagnant or obsolete inventory. Additionally, investors and stakeholders should monitor this trend to assess the company's ability to effectively utilize its resources and adapt to changing market demand.
Peer comparison
Sep 30, 2023