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Walking Company Holdings, Inc. (OTCPK:WALK)
Inventory
$75.0 Mil (As of Sep. 2008)

Walking Company Holdings, Inc.'s inventory for the quarter that ended in Sep. 2008 was $75.0 Mil.

In Ben Graham’s calculation of liquidation value, inventory is only considered worth half of its book value. Walking Company Holdings, Inc.'s liquidation value for the quarter that ended in Sep. 2008 was $-62.3 Mil.

Inventory can be measured by days sales of inventory (DSI). Walking Company Holdings, Inc.'s days sales of inventory (DSI) for the three months ended in Sep. 2008 was 114.81.

Days inventory indicates the number of days of goods in sales that a company has in the inventory. Walking Company Holdings, Inc.'s days inventory for the three months ended in Sep. 2008 was 221.82.

Inventory turnover measures how fast the company turns over its inventory within a year. Walking Company Holdings, Inc.'s inventory turnover for the quarter that ended in Sep. 2008 was 0.41.

Inventory to revenue ratio determines the ability of a company to manage their inventory levels. It measures the percentage of Inventories the company currently has on hand to support the current amount of Revenue. Walking Company Holdings, Inc.'s inventory to revenue ratio for the quarter that ended in Sep. 2008 was 1.26.


Definition

Inventory includes the raw materials, work-in-process goods and completely finished goods of a company. It is a portion of a company’s current assets.


Explanation

Inventory control is an important part of business operation. If a company does not have enough inventory, it may not be able to meet customers’ required delivery time. If it has too much inventory, the cost of holding the inventory can be high.

1. In Ben Graham’s calculation of liquidation value, inventory is only considered worth half of its book value.

Walking Company Holdings, Inc.'s liquidation value for the quarter that ended in Sep. 2008 is

Liquidation value (Q: Sep. 2008 )
=Cash and Cash Equivalents-Total Liabilities+(0.75 * Account Receivable)+(0.5 * Inventory)
=0.536-104.186+0.75 * 5.098+0.5 * 75.028
=-62.3

2. Inventory can be measured by Days Sales of Inventory (DSI).

Walking Company Holdings, Inc.'s Days Sales of Inventory for the three months ended in Sep. 2008 is

Days Sales of Inventory (DSI)
=Inventory (Q: Sep. 2008 )/Revenue (Q: Sep. 2008 )*Days in Period
=75.028/59.47*91
=114.81

3. Days Inventory indicates the number of days of goods in sales that a company has in the inventory.

Walking Company Holdings, Inc.'s Days Inventory for the three months ended in Sep. 2008 is calculated as:

Days Inventory=Inventory (Q: Sep. 2008 )/Cost of Goods Sold (Q: Sep. 2008 )*Days in Period
=75.028/30.779*91
=221.82

4. Inventory Turnover measures how fast the company turns over its inventory within a year.

Walking Company Holdings, Inc.'s Inventory Turnover for the quarter that ended in Sep. 2008 is calculated as

Inventory Turnover=Cost of Goods Sold (Q: Sep. 2008 ) / Average Inventory (Q: Sep. 2008 )
=30.779 / 75.028
=0.41

5. Inventory to Revenue determines the ability of a company to manage their inventory levels. It measures the percentage of Inventories the company currently has on hand to support the current amount of Revenue.

Walking Company Holdings, Inc.'s Inventory to Revenue for the quarter that ended in Sep. 2008 is calculated as

Inventory to Revenue=Inventory (Q: Sep. 2008 ) / Revenue (Q: Sep. 2008 )
=75.028 / 59.47
=1.26

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.


Be Aware

Manufacturers with durable competitive advantages have the advantage that the products they sell do not change, and therefore will never become obsolete. Buffett likes this advantage.

When identifying manufacturers with durable competitive advantage, look for inventory and net earnings that rise correspondingly. This indicates that the company is finding profitable ways to increase sales which called for an increase in inventory.

Manufacturers with inventories that spike up and down are indicative of competitive industries subject to boom and bust.


Related Terms

Revenue, Cash and Cash Equivalents, Total Liabilities, Account Receivable, Inventory, NCAV, Days Inventory, Cost of Goods Sold, Inventory Turnover, Inventory to Revenue


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Walking Company Holdings, Inc. Annual Data

Dec98Dec99Dec00Dec01Dec02Dec03Dec04Dec05Dec06Dec07
Inventory 23.320.026.826.824.824.839.644.558.663.9

Walking Company Holdings, Inc. Quarterly Data

Jun06Sep06Dec06Mar07Jun07Sep07Dec07Mar08Jun08Sep08
Inventory 56.171.358.674.069.482.663.977.068.075.0
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