TRI Pointe Homes Inc (TPH)

Inventory turnover

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
Cost of revenue (ttm) US$ in thousands 3,440,546 3,451,446 3,221,353 3,007,918 2,881,159 3,045,941 3,175,497 3,246,741 3,187,792 2,967,783 2,950,085 2,979,641 2,990,114 2,882,111 2,769,582 2,605,101 2,532,348 2,615,402 2,546,337 2,524,117
Inventory US$ in thousands 3,153,460 3,412,630 3,465,810 3,422,880 3,337,480 3,412,800 3,193,330 3,142,410 3,173,850 3,608,300 3,490,320 3,288,350 3,054,740 3,136,480 3,085,580 3,015,980 2,910,140 2,989,380 3,012,620 3,194,150
Inventory turnover 1.09 1.01 0.93 0.88 0.86 0.89 0.99 1.03 1.00 0.82 0.85 0.91 0.98 0.92 0.90 0.86 0.87 0.87 0.85 0.79

December 31, 2024 calculation

Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $3,440,546K ÷ $3,153,460K
= 1.09

TRI Pointe Homes Inc's inventory turnover ratio has shown some fluctuations over the period from March 31, 2020, to December 31, 2024. The ratio started at 0.79 on March 31, 2020, indicating that the company's inventory turned over approximately 0.79 times during that period. Subsequently, there was a general trend of improvement in inventory turnover, reaching a peak of 1.09 on December 31, 2024.

The inventory turnover ratio measures how efficiently a company manages its inventory by indicating how many times the inventory is sold and replaced over a specific period. A higher turnover ratio is generally preferred as it suggests that the company is selling its inventory more quickly, reducing the risk of obsolescence and carrying costs.

Throughout the analyzed period, TRI Pointe Homes Inc's inventory turnover ratio demonstrated an overall positive trend, with some minor fluctuations. Specifically, the ratio improved from 0.79 to 1.09, reflecting more efficient management of inventory over time. This improvement could be attributed to various factors, such as better demand forecasting, improved inventory management practices, or more effective sales and marketing strategies. However, the slight decline observed in the latest data points should be monitored to ensure that it does not indicate potential inventory management challenges.