Days inventory
What is the Days inventory?
This is a parameter that shows the time in days that is spent turning a company's inventory into sales. It is not available for banks.
Formula:
Average inventories / Cost of goods sold * Days in period
What does the Days inventory mean?
This metric is an indicator of a company's inventory management. Low values are preferred for Days Inventory, which means items are selling faster and there is a quick turnaround. Large values indicate that a company has invested too much in stocks and does not have time to sell them.