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Smith & Wesson Holding Corp (NAS:SWHC)
Inventory to Revenue
0.44 (As of Oct. 2016)

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. Smith & Wesson Holding Corp's average inventory for the quarter that ended in Oct. 2016 was \$102.1 Mil. Smith & Wesson Holding Corp's revenue for the three months ended in Oct. 2016 was \$233.5 Mil. Smith & Wesson Holding Corp's inventory to revenue ratio for the quarter that ended in Oct. 2016 was 0.44.

Smith & Wesson Holding Corp's inventory to revenue ratio for the quarter that ended in Oct. 2016 increased from Jul. 2016 (0.40) to Jul. 2016 (0.44)

An increase in inventory to revenue ratio from one quarter to the next indicates that one of the following is happening:

1. investment in inventory is growing more rapidly than revenue
2. revenue are dropping
No matter which situation is causing the problem, an increase in the inventory to revenue ratio may signal an oncoming cash flow problem.

Days inventory indicates the number of days of goods in sales that a company has in the inventory. Smith & Wesson Holding Corp's days inventory for the three months ended in Oct. 2016 was 68.53.

Inventory can be measured by Days Sales of Inventory (DSI). Smith & Wesson Holding Corp's days sales of inventory (DSI) for the three months ended in Oct. 2016 was 39.88.

Inventory turnover measures how fast the company turns over its inventory within a year. Smith & Wesson Holding Corp's inventory turnover for the quarter that ended in Oct. 2016 was 1.33.

Definition

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.

Smith & Wesson Holding Corp's Inventory to Revenue for the fiscal year that ended in Apr. 2016 is calculated as

 Inventory to Revenue (A: Apr. 2016 ) = Average Inventory / Revenue = ( (Inventory (A: Apr. 2015 ) + Inventory (A: Apr. 2016 )) / 2 ) / Revenue (A: Apr. 2016 ) = ( (76.895 + 77.789) / 2 ) / 722.908 = 77.342 / 722.908 = 0.11

Smith & Wesson Holding Corp's Inventory to Revenue for the quarter that ended in Oct. 2016 is calculated as

 Inventory to Revenue (Q: Oct. 2016 ) = Average Inventory / Revenue = ( (Inventory (Q: Jul. 2016 ) + Inventory (Q: Oct. 2016 )) / 2 ) / Revenue (Q: Oct. 2016 ) = ( (87.649 + 116.497) / 2 ) / 233.528 = 102.073 / 233.528 = 0.44

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Explanation

An increase in inventory to revenue ratio from one quarter to the next indicates that one of the following is happening:

1. investment in inventory is growing more rapidly than revenue
2. revenue are dropping
No matter which situation is causing the problem, an increase in the inventory to revenue ratio may signal an oncoming cash flow problem.

Likewise, a decrease in the inventory to revenue ratio from one quarter to next indicates that one of these is occurring:

1. investment in inventory is shrinking in relation to revenue
2. revenue are increasing
No matter which situation is causing the reduction in the inventory to revenue ratio, either one suggests that business's inventory levels and its cash flow are effectively managed.

More Related Terms:

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

Smith & Wesson Holding Corp's Days Inventory for the three months ended in Oct. 2016 is calculated as:

 Days Inventory = Average Inventory (Q: Oct. 2016 ) / Cost of Goods Sold (Q: Oct. 2016 ) * Days in Period = 102.073 / 135.923 * 365 / 4 = 68.53

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

Smith & Wesson Holding Corp's Days Sales of Inventory for the three months ended in Oct. 2016 is

 Days Sales of Inventory (DSI) = Average Inventory (Q: Oct. 2016 ) / Revenue (Q: Oct. 2016 ) * Days in Period = 102.073 / 233.528 * 365 / 4 = 39.88

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

Smith & Wesson Holding Corp's Inventory Turnover for the quarter that ended in Oct. 2016 is calculated as

 Inventory Turnover = Cost of Goods Sold (Q: Oct. 2016 ) / Average Inventory (Q: Oct. 2016 ) = 135.923 / 102.073 = 1.33

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Related Terms

Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Smith & Wesson Holding Corp Annual Data

 Apr07 Apr08 Apr09 Apr10 Apr11 Apr12 Apr13 Apr14 Apr15 Apr16 inventory2rev 0.11 0.13 0.13 0.11 0.15 0.13 0.10 0.12 0.15 0.11

Smith & Wesson Holding Corp Quarterly Data

 Jul14 Oct14 Jan15 Apr15 Jul15 Oct15 Jan16 Apr16 Jul16 Oct16 inventory2rev 0.71 0.93 0.75 0.48 0.57 0.67 0.42 0.35 0.40 0.44
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