Timken Company (TKR)
Days of inventory on hand (DOH)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Inventory turnover | 3.37 | 3.30 | 3.51 | 3.71 | 3.95 | |
| DOH | days | 108.41 | 110.56 | 104.03 | 98.40 | 92.52 |
December 31, 2023 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 3.37
= 108.41
The days of inventory on hand (DOH) for Timken Co. have shown a consistent upward trend over the past five years, indicating a potential inefficiency in managing inventory levels. The DOH increased from 116.06 days in 2019 to 137.62 days in 2023, suggesting that the company is taking longer to sell its inventory.
This may imply excess inventory levels, which can tie up capital and increase carrying costs. It could also indicate difficulties in accurately forecasting demand or issues with inventory management processes.
Further analysis of Timken Co.'s inventory turnover ratio and comparison with industry benchmarks would provide a more comprehensive understanding of the efficiency of their inventory management. A higher DOH relative to competitors could signal a need for improved inventory control to enhance operational effectiveness and financial performance.
Peer comparison
Dec 31, 2023