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Amcon Distributing Co  (AMEX:DIT) Total Inventories: $73 Mil (As of Sep. 2017)

Amcon Distributing Co's total inventories for the quarter that ended in Sep. 2017 was $73 Mil. Amcon Distributing Co's average total inventories from the quarter that ended in Jun. 2017 to the quarter that ended in Sep. 2017 was $61 Mil.

In Ben Graham's calculation of liquidation value, inventory is only considered worth half of its book value. Amcon Distributing Co's liquidation value for the quarter that ended in Sep. 2017 was $-4 Mil.

Inventory can be measured by days sales of inventory (DSI). Amcon Distributing Co's days sales of inventory (DSI) for the three months ended in Sep. 2017 was 16.47.

Days Inventory indicates the number of days of goods in sales that a company has in the inventory. Amcon Distributing Co's Days Inventory for the three months ended in Sep. 2017 was 17.43.

Inventory Turnover measures how fast the company turns over its inventory within a year. Amcon Distributing Co's Inventory Turnover for the quarter that ended in Sep. 2017 was 5.23.

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. Amcon Distributing Co's Inventory-to-Revenue for the quarter that ended in Sep. 2017 was 0.18.


Historical Data

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

* Premium members only.

Amcon Distributing Co Annual Data

Sep08 Sep09 Sep10 Sep11 Sep12 Sep13 Sep14 Sep15 Sep16 Sep17
Total Inventories Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 46.13 43.64 60.79 48.41 72.91

Amcon Distributing Co Quarterly Data

Dec12 Mar13 Jun13 Sep13 Dec13 Mar14 Jun14 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Mar16 Jun16 Sep16 Dec16 Mar17 Jun17 Sep17
Total Inventories Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 48.41 49.73 45.71 49.10 72.91

Calculation

Total Inventories 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.

Amcon Distributing Co's liquidation value for the quarter that ended in Sep. 2017 is

Liquidation value (Q: Sep. 2017 )
=Cash, Cash Equivalents, Marketable Securities-Total Liabilities+(0.75 * Accounts Receivable)+(0.5 * Total Inventories)
=0.523-63.636+0.75 * 30.69+0.5 * 72.91
=-4

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

Amcon Distributing Co's Days Sales of Inventory for the three months ended in Sep. 2017 is

Days Sales of Inventory (DSI)
=Total Inventories (Q: Sep. 2017 )/Revenue (Q: Sep. 2017 )*Days in Period
=61.0055/337.99*365 / 4
=16.47

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

Amcon Distributing Co's Days Inventory for the three months ended in Sep. 2017 is calculated as:

Days Inventory=Total Inventories (Q: Sep. 2017 )/Cost of Goods Sold (Q: Sep. 2017 )*Days in Period
=61.0055/319.356*365 / 4
=17.43

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

Amcon Distributing Co's Inventory Turnover for the quarter that ended in Sep. 2017 is calculated as

Inventory Turnover=Cost of Goods Sold (Q: Sep. 2017 ) / Total Inventories (Q: Sep. 2017 )
=319.356 / 61.0055
=5.23

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.

Amcon Distributing Co's Inventory to Revenue for the quarter that ended in Sep. 2017 is calculated as

Inventory-to-Revenue=Total Inventories (Q: Sep. 2017 ) / Revenue (Q: Sep. 2017 )
=61.0055 / 337.99
=0.18

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


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