Sally Beauty Holdings Inc (SBH)
Days of inventory on hand (DOH)
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|
| Inventory turnover | 3.49 | 3.75 | 3.97 | 4.01 | 3.60 | |
| DOH | days | 104.47 | 97.45 | 91.84 | 91.07 | 101.43 |
September 30, 2023 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 3.49
= 104.47
The days of inventory on hand (DOH) for Sally Beauty Holdings Inc has shown a fluctuating trend over the past five years. In 2019, the company had 176.92 days of inventory on hand, which increased to 194.52 days by 2023. This increase in DOH indicates that the company is taking longer to sell its inventory, which may tie up more of its capital in inventory and potentially lead to increased holding costs.
The rising trend in DOH may point to potential issues such as overstocking, aging inventory, or a slowdown in sales. A high DOH can also indicate inefficiencies in inventory management and could potentially lead to higher carrying costs and obsolescence risks.
It is important for the company to closely monitor and manage its inventory levels to optimize working capital and ensure that the right amount of inventory is available to meet customer demand without incurring unnecessary holding costs. Further analysis of inventory turnover and sales trends could provide additional insights into the company's inventory management efficiency.
Peer comparison
Sep 30, 2023