Toro Co (TTC)
Days of inventory on hand (DOH)
| Feb 2, 2024 | Oct 31, 2023 | Aug 4, 2023 | Feb 3, 2023 | Oct 31, 2022 | Jul 29, 2022 | Apr 29, 2022 | Jan 28, 2022 | Oct 31, 2021 | Jul 30, 2021 | Apr 30, 2021 | Jan 29, 2021 | Oct 31, 2020 | Jul 31, 2020 | May 1, 2020 | Jan 31, 2020 | Oct 31, 2019 | Aug 2, 2019 | May 3, 2019 | Feb 1, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Inventory turnover | 3.36 | 3.73 | 3.75 | 3.67 | 3.78 | 4.08 | 4.14 | 4.30 | 4.69 | 4.99 | 5.08 | 4.48 | 4.56 | 4.44 | 4.14 | 4.03 | 4.34 | 4.02 | 3.51 | 4.48 | |
| DOH | days | 108.75 | 97.81 | 97.43 | 99.58 | 96.57 | 89.40 | 88.21 | 84.92 | 77.76 | 73.08 | 71.87 | 81.42 | 80.13 | 82.13 | 88.12 | 90.58 | 84.01 | 90.79 | 104.02 | 81.40 |
February 2, 2024 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 3.36
= 108.75
To analyze Toro Co.'s days of inventory on hand (DOH) over the specified time period, we observe a general upward trend in the metric, indicating inventory levels are increasing relative to sales. In Q1 2024, the DOH reached 149.18 days compared to 133.43 days in Q4 2023, marking a significant increase. The company's inventory management may need attention as the DOH has been consistently rising since Q2 2022.
The DOH peaked in Q1 2024 at 149.18 days, which suggests the company is holding its inventory for a longer period before selling it. This could tie up working capital and increase storage costs. However, compared to the previous year, there has been a general progression in the DOH metric, possibly indicating a deliberate strategic decision by Toro Co. to expand its inventory levels to meet anticipated demand or due to supply chain challenges.
The overall increasing trend in DOH signifies the potential need for Toro Co. to reassess its inventory management strategies to optimize working capital and improve operational efficiency. Further investigation into the reasons behind the rising DOH, such as changes in sales patterns, production delays, or fluctuations in demand, would be beneficial for a more detailed assessment of the company's inventory management performance.