Trex Company Inc (TREX)
Days of inventory on hand (DOH)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Inventory turnover | 7.65 | 5.97 | 11.01 | 9.49 | 9.94 | |
| DOH | days | 47.72 | 61.11 | 33.16 | 38.46 | 36.73 |
December 31, 2023 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 7.65
= 47.72
The trend in TREX Co., Inc.'s days of inventory on hand (DOH) over the past five years indicates fluctuations in the efficiency of managing inventory levels. In 2023, the DOH was 60.84 days, representing an increase from the previous year and a deviation from the downward trend observed in the two prior years. This suggests that the company may have experienced challenges in controlling its inventory levels efficiently during the most recent period.
Comparing the DOH to previous years, the highest level of 73.49 days was recorded in 2022, indicating a significant increase in the time it took to sell inventory compared to the year before. In 2021, the DOH was relatively low at 41.51 days, showing a positive trend of improved inventory management efficiency. However, this positive trend was not sustained, as the DOH increased in 2022 and 2023.
Further analysis of the DOH trend reveals that in 2020 and 2019, the company maintained relatively stable DOH levels of 47.77 days and 46.67 days, respectively. These consistent levels suggest that TREX Co., Inc. was able to manage its inventory effectively during those years.
Overall, the trend in TREX Co., Inc.'s days of inventory on hand indicates some variability in inventory management efficiency over the past five years. The recent increase in DOH levels may warrant a closer examination of the company's inventory control processes to identify potential areas for improvement and to strive for more consistent and optimal inventory management practices in the future.
Peer comparison
Dec 31, 2023