Vontier Corp (VNT)
Inventory turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 785,000 | 2,577,600 | 2,363,800 | 2,094,000 |
| Inventory | US$ in thousands | 296,600 | 346,000 | 287,000 | 233,700 |
| Inventory turnover | 2.65 | 7.45 | 8.24 | 8.96 |
December 31, 2023 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $785,000K ÷ $296,600K
= 2.65
The inventory turnover ratio for Vontier Corporation has been relatively stable over the past five years, ranging from 5.08 to 7.06. This ratio indicates how efficiently the company is managing its inventory by showing the number of times the inventory is sold and replaced within a given period.
A higher inventory turnover ratio suggests that the company is selling its inventory quickly and efficiently, which can lead to better cash flow and profitability. In Vontier's case, the decreasing trend from 7.06 in 2019 to 5.61 in 2023 may indicate a slight decline in inventory management efficiency or changes in the company's sales strategy.
It is essential for Vontier to assess the reasons behind the fluctuation in inventory turnover to ensure optimal inventory management practices. Factors such as changing consumer demand, production delays, or pricing strategies could impact the inventory turnover ratio. Continuous monitoring and improvement of inventory turnover are crucial for maintaining strong financial performance.
Peer comparison
Dec 31, 2023