Watsco Inc (WSO)
Inventory turnover
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cost of revenue (ttm) | US$ in thousands | 5,593,500 | 5,496,400 | 5,462,510 | 5,333,390 | 5,291,620 | 5,250,510 | 5,175,560 | 5,273,320 | 5,244,050 | 5,196,130 | 5,011,080 | 4,844,560 | 4,612,647 | 4,385,369 | 4,248,379 | 3,912,869 | 3,832,113 | 3,771,435 | 3,668,745 | 3,676,425 |
| Inventory | US$ in thousands | 1,385,440 | 1,596,800 | 1,573,500 | 1,655,640 | 1,347,290 | 1,549,740 | 1,689,310 | 1,614,290 | 1,370,170 | 1,385,190 | 1,480,520 | 1,390,300 | 1,115,470 | 1,042,140 | 1,044,610 | 986,648 | 793,869 | 884,653 | 854,368 | 942,815 |
| Inventory turnover | 4.04 | 3.44 | 3.47 | 3.22 | 3.93 | 3.39 | 3.06 | 3.27 | 3.83 | 3.75 | 3.38 | 3.48 | 4.14 | 4.21 | 4.07 | 3.97 | 4.83 | 4.26 | 4.29 | 3.90 |
December 31, 2024 calculation
Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $5,593,500K ÷ $1,385,440K
= 4.04
The inventory turnover ratio of Watsco Inc has shown some fluctuations over the period from March 31, 2020, to December 31, 2024. The ratio, which measures how many times a company's inventory is sold and replaced over a certain period, has ranged from a low of 3.06 to a high of 4.83 during this timeframe.
In general, a higher inventory turnover ratio indicates that a company is efficiently managing its inventory by quickly selling and restocking goods. The trend for Watsco Inc's inventory turnover ratio has shown some variability, but overall, it has stayed within a moderate range.
However, it is worth noting that a decreasing trend in the inventory turnover ratio can indicate potential issues such as overstocking or slow-moving inventory, whereas a sharp increase may suggest inventory shortages or lost sales opportunities.
Overall, while Watsco Inc's inventory turnover ratio has shown fluctuations, it is important for the company to continue monitoring and managing its inventory effectively to ensure optimal performance and profitability.