Sonic Automotive Inc (SAH)

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	13,767,600	13,483,800	13,612,900	13,842,200	13,949,700	14,201,700	13,993,900	13,770,700	13,687,700	12,980,230	12,628,430	12,463,850	11,861,000	11,525,890	11,030,600	9,902,120	9,733,100	9,394,900	9,258,700	9,433,130
Inventory	US$ in thousands	1,957,700	1,918,800	1,952,300	1,700,500	1,578,300	1,433,900	1,448,800	1,462,600	1,216,800	1,197,100	1,240,400	1,198,100	1,261,200	850,469	1,016,570	1,232,250	1,247,300	1,137,850	1,176,510	1,608,220
Inventory turnover		7.03	7.03	6.97	8.14	8.84	9.90	9.66	9.42	11.25	10.84	10.18	10.40	9.40	13.55	10.85	8.04	7.80	8.26	7.87	5.87

December 31, 2024 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $13,767,600K ÷ $1,957,700K
= 7.03

Inventory turnover is a crucial financial ratio that measures how efficiently a company manages its inventory. The data provided for Sonic Automotive Inc indicates that the company's inventory turnover has shown fluctuations over the specified periods.

From March 31, 2020, to June 30, 2021, Sonic Automotive Inc experienced a steady increase in its inventory turnover ratio, indicating that the company was selling its inventory at a faster rate. This trend suggests effective inventory management and potential increased sales activity during this period.

However, from September 30, 2021, to December 31, 2024, there was some variability in the inventory turnover ratio, with fluctuations observed in the values. These fluctuations may indicate changes in sales volume, changes in the mix of products sold, or alterations in inventory management practices.

Overall, Sonic Automotive Inc appears to have maintained a relatively stable inventory turnover ratio, suggesting a balanced approach to managing its inventory levels. However, the company should continuously monitor and analyze its inventory turnover to ensure optimal efficiency in inventory management.