Shake Shack Inc (SHAK)
Days of inventory on hand (DOH)
| 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 23, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Inventory turnover | 103.02 | 98.47 | 93.23 | 95.90 | 97.21 | 95.90 | 93.68 | 92.04 | 83.84 | 86.53 | 78.05 | 91.16 | 83.45 | 115.07 | 139.33 | 186.91 | 185.50 | 219.54 | 215.14 | 207.73 | |
| DOH | days | 3.54 | 3.71 | 3.92 | 3.81 | 3.75 | 3.81 | 3.90 | 3.97 | 4.35 | 4.22 | 4.68 | 4.00 | 4.37 | 3.17 | 2.62 | 1.95 | 1.97 | 1.66 | 1.70 | 1.76 |
December 31, 2023 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 103.02
= 3.54
Days of Inventory on Hand (DOH) is a liquidity ratio that measures the average number of days a company takes to sell its inventory. A lower DOH indicates better inventory management efficiency, as it implies faster inventory turnover.
Analyzing Shake Shack Inc's historical DOH data, we observe a fluctuating trend over the past few years. In the most recent quarter ending December 31, 2023, the DOH was 3.54 days, showing a slight decrease compared to the previous quarter. This suggests that Shake Shack managed its inventory more efficiently in the latest period.
Looking back further, Shake Shack's DOH has generally shown a decreasing trend since the end of 2019, indicating improvements in inventory turnover efficiency. The lowest DOH was reported in March 2020 at 1.95 days, which suggests the company was able to quickly sell its inventory during that period.
Overall, the decreasing trend in Shake Shack's DOH indicates positive inventory management practices, as the company has been able to sell its products more quickly over time. This could lead to lower carrying costs, reduced risk of inventory obsolescence, and improved cash flow from inventory turnover. However, it is essential for Shake Shack to continue monitoring and managing its inventory effectively to sustain this positive trend.
Peer comparison
Dec 31, 2023