Constellation Brands Inc Class A (STZ)

Inventory turnover

		Feb 29, 2024	Feb 28, 2023	Feb 28, 2022	Feb 28, 2021	Feb 29, 2020
Cost of revenue	US$ in thousands	6,938,900	7,682,400	5,835,700	5,830,300	5,831,300
Inventory	US$ in thousands	2,078,300	1,898,700	1,573,200	1,291,100	1,373,600
Inventory turnover		3.34	4.05	3.71	4.52	4.25

February 29, 2024 calculation

Inventory turnover = Cost of revenue ÷ Inventory
= $6,938,900K ÷ $2,078,300K
= 3.34

Constellation Brands Inc Class A's inventory turnover has been fluctuating over the past five years. The trend indicates a slight decline, moving from 4.25 in 2020 to 3.34 in 2024. This suggests that the company may be holding its inventory for a longer period before selling it. A lower inventory turnover could potentially indicate inefficiencies in inventory management, such as overstocking or slow-moving inventory.

It is essential for Constellation Brands Inc Class A to regularly evaluate and optimize its inventory management practices to improve its inventory turnover ratio. This could involve forecasting demand more accurately, implementing efficient inventory control systems, and negotiating better terms with suppliers to reduce carrying costs. By enhancing inventory turnover, the company can free up working capital, reduce carrying costs, and potentially improve overall profitability.