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Toll Brothers Inc  (NYSE:TOL) Total Inventories: $7,634 Mil (As of Jul. 2017)

Toll Brothers Inc's total inventories for the quarter that ended in Jul. 2017 was $7,634 Mil. Toll Brothers Inc's average total inventories from the quarter that ended in Apr. 2017 to the quarter that ended in Jul. 2017 was $7,618 Mil.

In Ben Graham's calculation of liquidation value, inventory is only considered worth half of its book value. Toll Brothers Inc's liquidation value for the quarter that ended in Jul. 2017 was $-833 Mil.

Inventory can be measured by days sales of inventory (DSI). Toll Brothers Inc's days sales of inventory (DSI) for the three months ended in Jul. 2017 was 462.54.

Days Inventory indicates the number of days of goods in sales that a company has in the inventory. Toll Brothers Inc's Days Inventory for the three months ended in Jul. 2017 was 591.10.

Inventory Turnover measures how fast the company turns over its inventory within a year. Toll Brothers Inc's Inventory Turnover for the quarter that ended in Jul. 2017 was 0.15.

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. Toll Brothers Inc's Inventory-to-Revenue for the quarter that ended in Jul. 2017 was 5.07.


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.

Toll Brothers Inc Annual Data

Oct07 Oct08 Oct09 Oct10 Oct11 Oct12 Oct13 Oct14 Oct15 Oct16
Total Inventories Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 3,761.19 4,650.41 6,490.32 6,997.52 7,353.97

Toll Brothers Inc Quarterly Data

Oct12 Jan13 Apr13 Jul13 Oct13 Jan14 Apr14 Jul14 Oct14 Jan15 Apr15 Jul15 Oct15 Jan16 Apr16 Jul16 Oct16 Jan17 Apr17 Jul17
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 7,670.52 7,353.97 7,539.97 7,602.70 7,633.57

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.

Toll Brothers Inc's liquidation value for the quarter that ended in Jul. 2017 is

Liquidation value (Q: Jul. 2017 )
=Cash, Cash Equivalents, Marketable Securities-Total Liabilities+(0.75 * Accounts Receivable)+(0.5 * Total Inventories)
=946.195-5596.222+0.75 * 0+0.5 * 7633.568
=-833

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

Toll Brothers Inc's Days Sales of Inventory for the three months ended in Jul. 2017 is

Days Sales of Inventory (DSI)
=Total Inventories (Q: Jul. 2017 )/Revenue (Q: Jul. 2017 )*Days in Period
=7618.1315/1502.909*365 / 4
=462.54

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

Toll Brothers Inc's Days Inventory for the three months ended in Jul. 2017 is calculated as:

Days Inventory=Total Inventories (Q: Jul. 2017 )/Cost of Goods Sold (Q: Jul. 2017 )*Days in Period
=7618.1315/1176.028*365 / 4
=591.10

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

Toll Brothers Inc's Inventory Turnover for the quarter that ended in Jul. 2017 is calculated as

Inventory Turnover=Cost of Goods Sold (Q: Jul. 2017 ) / Total Inventories (Q: Jul. 2017 )
=1176.028 / 7618.1315
=0.15

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.

Toll Brothers Inc's Inventory to Revenue for the quarter that ended in Jul. 2017 is calculated as

Inventory-to-Revenue=Total Inventories (Q: Jul. 2017 ) / Revenue (Q: Jul. 2017 )
=7618.1315 / 1502.909
=5.07

* 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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