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TAL Education Group (NYSE:XRS)
Inventory Turnover
123.07 (As of May. 2016)

Inventory turnover measures how fast the company turns over its inventory within a year. It is calculated as cost of goods sold divided by average inventory. TAL Education Group's cost of goods sold for the three months ended in May. 2016 was \$100.5 Mil. TAL Education Group's average inventory for the quarter that ended in May. 2016 was \$0.8 Mil. TAL Education Group's inventory turnover for the quarter that ended in May. 2016 was 123.07.

Days inventory indicates the number of days of goods in sales that a company has in the inventory. TAL Education Group's days inventory for the three months ended in May. 2016 was 0.74.

Inventory can be measured by Days Sales of Inventory (DSI). TAL Education Group's days sales of inventory (DSI) for the three months ended in May. 2016 was 0.38.

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. TAL Education Group's inventory to revenue ratio for the quarter that ended in May. 2016 was 0.00.

Definition

TAL Education Group's Inventory Turnover for the fiscal year that ended in Feb. 2016 is calculated as

 Inventory Turnover (A: Feb. 2016 ) = Cost of Goods Sold / Average Inventory = Cost of Goods Sold (A: Feb. 2016 ) / ( (Inventory (A: Feb. 2015 ) + Inventory (A: Feb. 2016 )) / 2 ) = 303.635 / ( (0.544 + 0.6) / 2 ) = 303.635 / 0.572 = 530.83

TAL Education Group's Inventory Turnover for the quarter that ended in May. 2016 is calculated as

 Inventory Turnover (Q: May. 2016 ) = Cost of Goods Sold / Average Inventory = Cost of Goods Sold (Q: May. 2016 ) / ( (Inventory (Q: Feb. 2016 ) + Inventory (Q: May. 2016 )) / 2 ) = 100.487 / ( (0.6 + 1.033) / 2 ) = 100.487 / 0.8165 = 123.07

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

Explanation

Inventory Turnover measures how fast the company turns over its inventory within a year. A higher inventory turnover means the company has light inventory. Therefore the company spends less money on storage, write downs, and obsolete inventory. If the inventory is too light, it may affect sales because the company may not have enough to meet demand.

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

TAL Education Group's Days Inventory for the three months ended in May. 2016 is calculated as:

 Days Inventory = Average Inventory (Q: May. 2016 ) / Cost of Goods Sold (Q: May. 2016 ) * Days in Period = 0.8165 / 100.487 * 365 / 4 = 0.74

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

TAL Education Group's Days Sales of Inventory for the three months ended in May. 2016 is calculated as:

 Days Sales of Inventory (DSI) = Average Inventory (Q: May. 2016 ) / Revenue (Q: May. 2016 ) * Days in Period = 0.8165 / 195.095 * 365 / 4 = 0.38

3. 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.

TAL Education Group's Inventory to Revenue for the quarter that ended in May. 2016 is calculated as

 Inventory to Revenue = Average Inventory (Q: May. 2016 ) / Revenue (Q: May. 2016 ) = 0.8165 / 195.095 = 0.00

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

Be Aware

Usually retailers pile up their inventories at holiday seasons to meet the stronger demand. Therefore, the inventory of a particular quarter of a year should not be used to calculate inventory turnover. An average inventory is a better indication.

Related Terms

Historical Data

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

TAL Education Group Annual Data

 Feb09 Feb10 Feb11 Feb12 Feb13 Feb14 Feb15 Feb16 Inventory Turnover 0.00 0.00 18,554.00 608.68 467.86 558.99 365.14 511.97 559.43 530.83

TAL Education Group Quarterly Data

 Feb14 May14 Aug14 Nov14 Feb15 May15 Aug15 Nov15 Feb16 May16 Inventory Turnover 232.29 244.54 273.72 196.22 145.60 146.74 235.25 194.53 185.33 123.07
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