Smurfit WestRock plc (SW)
Inventory turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 7,485,000 | 8,752,000 | 7,015,000 | 5,656,000 |
| Inventory | US$ in thousands | 1,036,000 | 1,241,000 | 1,056,000 | 784,000 |
| Inventory turnover | 7.22 | 7.05 | 6.64 | 7.21 |
December 31, 2023 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $7,485,000K ÷ $1,036,000K
= 7.22
The inventory turnover ratio for Smurfit WestRock plc has shown a consistent trend over the past four years, ranging from 6.64 to 7.22. This ratio indicates that the company is able to efficiently manage its inventory levels and convert them into sales. A higher inventory turnover ratio generally suggests that the company is effectively selling its products and not holding excess inventory, which could tie up capital.
In particular, Smurfit WestRock plc's inventory turnover increased from 6.64 in 2021 to 7.22 in 2023, which may indicate a more efficient inventory management strategy or improved sales performance. This improvement could be attributed to better demand forecasting, supply chain management, or inventory control practices.
Overall, a consistently healthy inventory turnover ratio demonstrates Smurfit WestRock plc's ability to effectively manage its inventory levels, leading to a more efficient use of resources and potentially higher profitability.
Peer comparison
Dec 31, 2023