Terex Corporation (TEX)
Inventory turnover
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cost of revenue (ttm) | US$ in thousands | 3,974,900 | 3,997,000 | 3,882,800 | 3,686,800 | 3,546,500 | 3,382,500 | 3,314,400 | 3,257,300 | 3,129,400 | 2,948,700 | 2,752,700 | 2,529,000 | 2,537,100 | 2,616,000 | 2,811,700 | 3,263,400 | 3,465,300 | 3,583,100 | 3,626,800 | 3,566,100 |
| Inventory | US$ in thousands | 1,186,000 | 1,117,000 | 1,122,000 | 1,083,200 | 988,400 | 981,200 | 963,200 | 921,300 | 813,500 | 747,700 | 711,700 | 658,800 | 610,400 | 635,500 | 699,800 | 823,000 | 847,700 | 858,000 | 863,100 | 955,400 |
| Inventory turnover | 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 | 4.09 | 4.18 | 4.20 | 3.73 |
December 31, 2023 calculation
Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $3,974,900K ÷ $1,186,000K
= 3.35
Terex Corp.'s inventory turnover ratio indicates the efficiency with which the company manages its inventory. A higher inventory turnover ratio is generally favorable as it signifies that inventory is sold or used more quickly.
Over the past eight quarters, Terex Corp.'s inventory turnover ratio has ranged from 3.35 to 3.59. This consistency in the range indicates stability in the company's inventory management practices. Despite slight fluctuations, the ratio has remained relatively close to the average of 3.48 over this period.
The inventory turnover ratio for Q4 2023 was 3.35, slightly lower than the previous quarter. This implies that the company took a longer time to sell or use its inventory compared to the previous quarter. It may be worth investigating the reasons behind this dip in efficiency.
Overall, Terex Corp.'s inventory turnover ratios show a fairly stable trend, suggesting effective inventory management. Further analysis, including comparisons with industry benchmarks and peer companies, could provide additional insights into the company's performance in this area.