Stepan Company (SCL)
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 | 2,199,145 | 2,288,614 | 2,412,545 | 2,525,897 | 2,515,221 | 2,485,608 | 2,384,378 | 2,246,544 | 2,109,540 | 1,968,894 | 1,822,531 | 1,695,443 | 1,632,663 | 1,599,554 | 1,606,044 | 1,626,516 | 1,661,963 | 1,685,784 | 1,739,355 | 1,785,503 |
| Inventory | US$ in thousands | 265,558 | 284,546 | 339,961 | 368,372 | 402,531 | 397,602 | 340,712 | 308,423 | 305,538 | 290,934 | 266,088 | 235,062 | 218,783 | 202,315 | 208,191 | 198,194 | 203,647 | 203,303 | 216,278 | 215,028 |
| Inventory turnover | 8.28 | 8.04 | 7.10 | 6.86 | 6.25 | 6.25 | 7.00 | 7.28 | 6.90 | 6.77 | 6.85 | 7.21 | 7.46 | 7.91 | 7.71 | 8.21 | 8.16 | 8.29 | 8.04 | 8.30 |
December 31, 2023 calculation
Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $2,199,145K ÷ $265,558K
= 8.28
Inventory turnover measures the efficiency of a company in managing its inventory levels and turning them into sales. Stepan Co.'s inventory turnover has been relatively stable over the past eight quarters, ranging from 5.82 to 7.71.
The consistent levels of inventory turnover indicate that Stepan Co. is effectively managing its inventory and converting it into sales within a reasonable timeframe. A higher turnover ratio suggests that the company is efficiently selling its inventory, minimizing holding costs, and potentially reducing the risk of obsolescence.
Overall, Stepan Co.'s inventory turnover ratio reflects a healthy balance between maintaining adequate inventory levels to meet customer demand while also efficiently managing inventory turnover to support profitability. However, it is important to consider industry norms and trends to assess how Stepan Co. is performing relative to its peers.
Peer comparison
Dec 31, 2023
Dec 31, 2023