Inventory Turnover

Motley Fool  Mar 2  Comment 
The investing world is filled with insider terminology, so to help you out, we’re demystifying some of it.
Motley Fool  Aug 22  Comment 
Here's how Costco's inventory turnover ratio compares to other companies, and why a higher inventory turnover rate is a key advantage in retail.
Investment U  May 30  Comment 
Someone in my office recently called me a finance geek. I was actually a little bit insulted. But then, as I started to write this column, I realized she spoke the truth... Inventory Turnover: The Metric That Predicted Qualcomm's Earnings Warning


Inventory Turnover is calculated by dividing the Cost of Goods Sold (COGS) by the Average Inventory

Average Inventory is calculated by beginning inventory plus ending inventory divided by 2.

Inventory Turnover is a operating metric often used in the retail industry to judge the rate at which inventory is sold and replaced. A low turnover rate may mean that a company overstocks and so holds its products on the shelves for too long.

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