Sensient Technologies Corporation (SXT)

Days of inventory on hand (DOH)

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Inventory turnover		2.18	2.20	0.73	0.75	0.70
DOH	days	167.13	165.74	499.70	485.76	519.84

December 31, 2023 calculation

DOH = 365 ÷ Inventory turnover
= 365 ÷ 2.18
= 167.13

The days of inventory on hand (DOH) ratio measures the average number of days a company holds onto its inventory before selling it. Sensient Technologies Corp.'s DOH has shown a fluctuating trend over the past five years.

In 2023, Sensient's DOH increased to 219.26 days compared to 217.21 days in 2022. This implies that, on average, the company took approximately 219 days to sell its inventory, which may indicate a slower inventory turnover rate or possible issues with inventory management efficiency.

Comparing it to 2021, where the DOH was 162.32 days, there seems to have been a notable increase, showing a decrease in the efficiency of managing inventory levels. The significant increase from 2021 to 2022 and 2023 might suggest potential challenges in managing inventory levels or an excess of unsold inventory on hand.

In 2020, the DOH was 153.25 days, showing a slight increase from the previous year. However, this increase was followed by a jump in 2021, indicating a possible change in inventory management practices or market conditions affecting inventory turnover.

Overall, the trend indicates that Sensient Technologies Corp. has experienced fluctuations in its inventory holding period over the past five years, which may warrant further investigation into the company's inventory management strategies and effectiveness in optimizing inventory turnover.