Teradyne Inc (TER)

Days of inventory on hand (DOH)

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Inventory turnover		3.68	3.96	6.15	6.01	4.86
DOH	days	99.29	92.11	59.36	60.72	75.16

December 31, 2023 calculation

DOH = 365 ÷ Inventory turnover
= 365 ÷ 3.68
= 99.29

Teradyne, Inc.'s days of inventory on hand (DOH) has shown fluctuations over the past five years. The trend indicates an increase in the DOH from 2019 to 2023, with the metric reaching its peak at 99.29 days in 2023. This signifies that Teradyne, Inc. held its inventory for an average of approximately 99.29 days before selling it during the most recent fiscal year.

The significant rise in DOH from 2019 to 2023 may suggest that the company's inventory management practices have become less efficient, potentially tying up more capital in inventory and leading to higher carrying costs. A high DOH value may also indicate potential issues such as slow inventory turnover, excess inventory levels, or difficulties in predicting customer demand accurately.

It would be advisable for Teradyne, Inc. to closely analyze its inventory management processes and seek opportunities to streamline operations, improve demand forecasting, and optimize inventory levels to enhance efficiency and profitability. Furthermore, continuous monitoring and adjustment of inventory strategies may be necessary to ensure optimal inventory turnover and cost-effectiveness for the company.