Canadian Tire (TSX:CTC.A) Inventory Turnover : 0.96 (As of Dec. 2023)

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What is Canadian Tire Inventory Turnover?

Inventory Turnover measures how fast the company turns over its inventory within a year. It is calculated as Cost of Goods Sold divided by Total Inventories. Canadian Tire's Cost of Goods Sold for the three months ended in Dec. 2023 was C$2,906 Mil. Canadian Tire's Average Total Inventories for the quarter that ended in Dec. 2023 was C$3,027 Mil. Canadian Tire's Inventory Turnover for the quarter that ended in Dec. 2023 was 0.96.

Days Inventory indicates the number of days of goods in sales that a company has in the inventory. Canadian Tire's Days Inventory for the three months ended in Dec. 2023 was 95.04.

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. Canadian Tire's Inventory-to-Revenue for the quarter that ended in Dec. 2023 was 0.68.

Canadian Tire Inventory Turnover Historical Data

The historical data trend for Canadian Tire's Inventory Turnover can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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Canadian Tire Inventory Turnover Chart

Canadian Tire Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Inventory Turnover

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4.59

4.33

4.36

4.11

3.71

Canadian Tire Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
Inventory Turnover	Get a 7-Day Free Trial															1.00	0.75	0.86	0.86	0.96

Canadian Tire Inventory Turnover Calculation

Canadian Tire's Inventory Turnover for the fiscal year that ended in Dec. 2023 is calculated as

	Inventory Turnover (A: Dec. 2023 )
=	Cost of Goods Sold	/	Average Total Inventories
=	Cost of Goods Sold (A: Dec. 2023 )	/ (	(Total Inventories (A: Dec. 2022 )	+	Total Inventories (A: Dec. 2023 ))	/	count )
=	10952.9	/ (	(3216.1	+	2693.7)	/	2 )
=	10952.9	/	2954.9
=	3.71

Canadian Tire's Inventory Turnover for the quarter that ended in Dec. 2023 is calculated as

	Inventory Turnover (Q: Dec. 2023 )
=	Cost of Goods Sold	/	Average Total Inventories
=	Cost of Goods Sold (Q: Dec. 2023 )	/ (	(Total Inventories (Q: Sep. 2023 )	+	Total Inventories (Q: Dec. 2023 ))	/	count )
=	2906.2	/ (	(3360	+	2693.7)	/	2 )
=	2906.2	/	3026.85
=	0.96

Canadian Tire (TSX:CTC.A) Inventory Turnover 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.

Canadian Tire's Days Inventory for the three months ended in Dec. 2023 is calculated as:

Days Inventory	=	Average Total Inventories (Q: Dec. 2023 )	/	Cost of Goods Sold (Q: Dec. 2023 )	*	Days in Period
	=	3026.85	/	2906.2	*	365 / 4
	=	95.04

2. 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.

Canadian Tire's Inventory to Revenue for the quarter that ended in Dec. 2023 is calculated as

Inventory-to-Revenue	=	Average Total Inventories (Q: Dec. 2023 )	/	Revenue (Q: Dec. 2023 )
	=	3026.85	/	4443
	=	0.68

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.

Canadian Tire Inventory Turnover Related Terms

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Canadian Tire (TSX:CTC.A) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Retail - Cyclical » Canadian Tire Corp Ltd (TSX:CTC.A) » Definitions » Inventory Turnover

Comparable Companies

Traded in Other Exchanges

CDNAF:USA YAAA:Germany CTC:Canada

Address

2180 Yonge Street, P.O. Box 770, Toronto, ON, CAN, M4P 2V8

Website

https://www.corp.canadiantire.ca

Canadian Tire sells home goods, sporting equipment, apparel, footwear, automotive parts and accessories, and vehicle fuel through a roughly 1,700-store network of company, dealer, and franchisee-operated locations across Canada. Aside from the namesake banner, stores operate primarily under the Mark's, SportChek, Party City, Atmosphere, and PartSource monikers. Additionally, the company owns Helly Hansen, a Norwegian sportswear and workwear brand, and also operates and holds majority ownership of a financing arm (Canadian Tire Financial Services; 20% owned by Scotiabank) and a REIT (CT REIT; Canadian Tire owns about 70%).

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