Xcel Energy Inc (XEL)

Inventory turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cost of revenue	US$ in thousands	918,000	1,101,000	947,000	973,000	801,000
Inventory	US$ in thousands	711,000	803,000	631,000	535,000	544,000
Inventory turnover		1.29	1.37	1.50	1.82	1.47

December 31, 2023 calculation

Inventory turnover = Cost of revenue ÷ Inventory
= $918,000K ÷ $711,000K
= 1.29

Xcel Energy, Inc. has demonstrated consistent inventory turnover over the past five years, with the ratio fluctuating between 7.92 and 9.27. The inventory turnover ratio indicates how many times a company's inventory is sold and replaced within a specific period.

A higher inventory turnover ratio typically suggests that a company is effectively managing its inventory levels by swiftly selling products and restocking, which can lead to lower holding costs and potentially higher profitability. Xcel Energy's inventory turnover ratios ranging from 7.92 to 9.27 indicate that the company has been efficient in managing its inventory during these years.

However, it's worth noting that a very high inventory turnover ratio could also imply insufficient inventory levels that might lead to stockouts and potential lost sales. Hence, it is crucial for Xcel Energy to strike a balance between maintaining optimal inventory levels and ensuring efficient turnover.

Overall, Xcel Energy's inventory turnover ratios reflect a consistent performance in managing its inventory effectively over the past five years, indicating good operational efficiency in this aspect of their business.