Fred's (STU:FR1A) Inventory Turnover : 1.05 (As of Apr. 2019)

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What is Fred's 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. Fred's's Cost of Goods Sold for the three months ended in Apr. 2019 was €217 Mil. Fred's's Average Total Inventories for the quarter that ended in Apr. 2019 was €208 Mil. Fred's's Inventory Turnover for the quarter that ended in Apr. 2019 was 1.05.

Days Inventory indicates the number of days of goods in sales that a company has in the inventory. Fred's's Days Inventory for the three months ended in Apr. 2019 was 87.25.

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. Fred's's Inventory-to-Revenue for the quarter that ended in Apr. 2019 was 0.73.

Fred's Inventory Turnover Historical Data

The historical data trend for Fred's'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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Fred's Inventory Turnover Chart

Fred's Annual Data

Trend

Jan10

Jan11

Jan12

Jan13

Jan14

Jan15

Jan16

Jan17

Jan18

Jan19

Inventory Turnover

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4.64

4.39

4.16

3.19

3.80

Fred's Quarterly Data
	Oct14	Jan15	Apr15	Jul15	Oct15	Jan16	Apr16	Jul16	Oct16	Jan17	Apr17	Jul17	Oct17	Jan18	Apr18	Jul18	Oct18	Jan19	Apr19	Apr20
Inventory Turnover	Get a 7-Day Free Trial															1.18	0.93	0.97	1.05	-

Fred's Inventory Turnover Calculation

Fred's's Inventory Turnover for the fiscal year that ended in Jan. 2019 is calculated as

	Inventory Turnover (A: Jan. 2019 )
=	Cost of Goods Sold	/	Average Total Inventories
=	Cost of Goods Sold (A: Jan. 2019 )	/ (	(Total Inventories (A: Jan. 2018 )	+	Total Inventories (A: Jan. 2019 ))	/	count )
=	831.128	/ (	(218.851	+	218.793)	/	2 )
=	831.128	/	218.822
=	3.80

Fred's's Inventory Turnover for the quarter that ended in Apr. 2019 is calculated as

	Inventory Turnover (Q: Apr. 2019 )
=	Cost of Goods Sold	/	Average Total Inventories
=	Cost of Goods Sold (Q: Apr. 2019 )	/ (	(Total Inventories (Q: Jan. 2019 )	+	Total Inventories (Q: Apr. 2019 ))	/	count )
=	217.473	/ (	(218.793	+	197.099)	/	2 )
=	217.473	/	207.946
=	1.05

Fred's (STU:FR1A) 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.

Fred's's Days Inventory for the three months ended in Apr. 2019 is calculated as:

Days Inventory	=	Average Total Inventories (Q: Apr. 2019 )	/	Cost of Goods Sold (Q: Apr. 2019 )	*	Days in Period
	=	207.946	/	217.473	*	365 / 4
	=	87.25

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.

Fred's's Inventory to Revenue for the quarter that ended in Apr. 2019 is calculated as

Inventory-to-Revenue	=	Average Total Inventories (Q: Apr. 2019 )	/	Revenue (Q: Apr. 2019 )
	=	207.946	/	283.866
	=	0.73

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.

Fred's Inventory Turnover Related Terms

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Fred's (STU:FR1A) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Defensive » Retail - Defensive » Fred's Inc (STU:FR1A) » Definitions » Inventory Turnover

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Traded in Other Exchanges

N/A

Address

4300 New Getwell Road, Memphis, TN, USA, 38118

Website

http://www.fredsinc.com

Fred's Inc is a U.S.-based company that is principally engaged in operating retail stores. Most of the company's stores are self-owned stores, with a few franchised stores. The company's sales mix consists of pharmaceuticals, consumables, household goods and softlines, and franchise, with pharmaceuticals contributing a material portion of total revenue. The company owns 100% of the equity stake in Reeves-Sain Drug Store. The company generates revenue from merchandise sales and franchise fee from franchisees. It also sells gift cards. The company conducts operation primarily in the southeast of the United States.

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