Vital Energy Inc. (VTLE)

Days of inventory on hand (DOH)

		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	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Inventory turnover		43.58	118.20	36.83	11.21	71.73	10.31	47.90	50.86	32.09	124.64	—	—	328.21	16.60	9.94	3.86	176.94	7.02	6.32	39.85
DOH	days	8.38	3.09	9.91	32.56	5.09	35.39	7.62	7.18	11.38	2.93	—	—	1.11	21.98	36.70	94.51	2.06	51.97	57.79	9.16

December 31, 2023 calculation

DOH = 365 ÷ Inventory turnover
= 365 ÷ 43.58
= 8.38

Days of Inventory on Hand (DOH) is a key efficiency ratio that measures how many days, on average, a company holds its inventory before selling it. A lower DOH indicates that the company is efficiently managing its inventory turnover.

Based on the historical data provided for Vital Energy Inc., we observe fluctuations in the DOH over the past few years. The DOH ranged from a low of 1.11 days on March 31, 2021, to a high of 94.51 days on March 31, 2020.

In the most recent period, as of December 31, 2023, Vital Energy Inc. had a DOH of 8.38 days. This indicates that the company took, on average, 8.38 days to sell its inventory during that period. Comparing this to the previous quarters, there was a noticeable increase in DOH from 3.09 days on September 30, 2023, possibly suggesting a slower inventory turnover rate during the most recent quarter.

It is important for Vital Energy Inc. to closely monitor and manage its inventory levels to ensure optimal balance between maintaining sufficient inventory for operations and minimizing excess inventory holding costs. A rising trend in DOH could imply potential issues such as overstocking, slowing sales, or inefficient inventory management practices, which may impact the company's profitability and liquidity.

Further analysis of the reasons behind the fluctuations in DOH over the historical periods and potential implications for Vital Energy Inc.'s operations and financial performance would be beneficial in gaining a comprehensive understanding of the company's inventory management effectiveness.