Constellation Brands Inc Class A (STZ)

Inventory turnover

		Feb 28, 2025	Nov 30, 2024	Aug 31, 2024	May 31, 2024	Feb 29, 2024	Nov 30, 2023	Aug 31, 2023	May 31, 2023	Feb 28, 2023	Nov 30, 2022	Aug 31, 2022	May 31, 2022	Feb 28, 2022	Nov 30, 2021	Aug 31, 2021	May 31, 2021	Feb 28, 2021	Nov 30, 2020	Aug 31, 2020	May 31, 2020
Cost of revenue (ttm)	US$ in thousands	4,910,200	4,986,900	5,007,700	4,987,500	4,970,500	4,880,900	4,890,200	4,832,500	4,683,600	4,616,900	4,502,200	4,314,400	4,113,400	4,102,800	4,177,800	4,081,000	4,148,900	4,142,700	3,984,700	4,098,200
Inventory	US$ in thousands	1,437,200	2,129,600	2,098,600	2,127,000	2,078,300	1,988,000	1,814,000	1,951,400	1,898,700	1,802,000	1,651,000	1,656,400	1,573,200	1,518,900	1,339,000	1,377,600	1,291,100	1,376,900	1,328,400	1,332,600
Inventory turnover		3.42	2.34	2.39	2.34	2.39	2.46	2.70	2.48	2.47	2.56	2.73	2.60	2.61	2.70	3.12	2.96	3.21	3.01	3.00	3.08

February 28, 2025 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $4,910,200K ÷ $1,437,200K
= 3.42

Constellation Brands Inc Class A has shown varying inventory turnover ratios over the period provided. The inventory turnover ratio measures how efficiently the company is managing its inventory by indicating how many times the inventory is sold and replaced during a specific period.

From May 2020 to May 2022, the inventory turnover ratio fluctuated between 2.96 to 3.21 times, indicating a relatively stable turnover rate. However, starting from August 2022, there was a downward trend in the ratio, reaching a low of 2.34 in August 2024, implying that the company was taking longer to sell its inventory.

The peak in the ratio at 3.42 in February 2025 suggests a significant improvement in inventory turnover efficiency. Overall, the downward trend observed from August 2022 to August 2024 may indicate potential inventory management challenges. Further analysis and comparison with industry benchmarks would be beneficial to assess Constellation Brands' inventory management effectiveness comprehensively.