Weatherford International PLC (WFRD)
Days of inventory on hand (DOH)
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Inventory turnover | 0.27 | 0.59 | 0.45 | 0.48 | 2.66 | |
| DOH | days | 1,366.81 | 621.21 | 803.47 | 764.22 | 137.31 |
December 31, 2024 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 0.27
= 1,366.81
The Days of Inventory on Hand (DOH) for Weatherford International PLC has shown significant fluctuations over the years. As of December 31, 2020, the company had an DOH of 137.31 days, indicating that, on average, it took the company approximately 137 days to sell its inventory. However, by December 31, 2021, this metric increased considerably to 764.22 days, suggesting a substantial surplus of inventory relative to sales. The trend continued with an even higher DOH of 803.47 days by December 31, 2022.
Despite a slight decrease in DOH to 621.21 days by December 31, 2023, the metric remained at a high level, indicating potentially inefficient inventory management practices. By December 31, 2024, the DOH spiked to 1,366.81 days, signifying a significant challenge in converting inventory into sales within a reasonable timeframe.
The sharp increases in DOH over the years may raise concerns regarding inventory control, carrying costs, and potential obsolescence issues. Weatherford International PLC may need to reassess its inventory management strategies to optimize working capital utilization, improve liquidity, and enhance operational efficiency.
Peer comparison
Dec 31, 2024