Terex Corporation (TEX)
Days of inventory on hand (DOH)
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Inventory turnover | 3.54 | 3.25 | 3.25 | 3.30 | 3.35 | 3.58 | 3.46 | 3.40 | 3.59 | 3.45 | 3.44 | 3.54 | 3.85 | 3.94 | 3.87 | 3.84 | 4.16 | 4.12 | 4.02 | 3.97 | |
| DOH | days | 103.13 | 112.19 | 112.31 | 110.73 | 108.89 | 101.99 | 105.47 | 107.24 | 101.72 | 105.88 | 106.07 | 103.24 | 94.88 | 92.55 | 94.37 | 95.08 | 87.82 | 88.67 | 90.84 | 92.05 |
December 31, 2024 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 3.54
= 103.13
Terex Corporation's days of inventory on hand (DOH) have shown some fluctuations over the past few years. The trend indicates an increase in the DOH from the first quarter of 2020 to the second quarter of 2022, peaking at 112.31 days. This suggests that Terex held inventory for a longer period, which could tie up capital and lead to potential obsolescence risks.
Subsequently, there was a slight decline in DOH in the third quarter of 2024, but it still remained relatively high at 103.13 days. This indicates that Terex is still holding a significant amount of inventory relative to its sales.
A high DOH may suggest inefficiencies in managing inventory levels, which could impact working capital needs and overall profitability. On the other hand, a lower DOH could indicate effective inventory management and faster turnover of goods, potentially leading to improved cash flow and profitability.
Overall, it would be prudent for Terex Corporation to closely monitor its inventory levels, aim for a balance between holding enough inventory to meet demand and avoiding excess, and assess strategies to optimize inventory management and turnover.