Category: Money tips Release Date: 2006-06-07
Moderator: inventory turnover ratio is a measure of the level of listed companies, asset management capabilities is an important indicator. With this indicator, one can see the company's products from the purchase of raw materials, production and sales management of all aspects of recycling conditions, the efficiency of corporate assets, the direct embodiment. In this issue, we invite the securities industry veteran Mr. Zhang Hongji to describe the use of this indicator.
Beijing Haidian District, Ho investors: How to calculate inventory turnover rate?
Zhang Q: inventory turnover rate, there are two forms - the number of inventory turnover and inventory turnover days. The calculation formula is as follows:
Inventory turnover = Cost of / inventory = Cost of the average balance / (beginning inventory + ending inventory) / 2 î™?/span>
The average inventory turnover days = (average inventory balance / Main business costs) × 365 = 365 / inventory turnover
Beijing Fengtai District, shareholders Ms. Zhao: inventory turnover rate is not as high as possible?
Zhang Q: Generally speaking, the higher the better inventory turnover. Because the stock will take up a lot of liquidity in business, if we can liberate this part of the funds into other areas, such as the expansion of production lines, foreign investment, it will undoubtedly create more value.
In addition, through the vertical comparison of this indicator (a listed company's inventory turnover rate over the years) is also able to demonstrate a certain extent, the listed company's major products sold in the market, and if this indicator go high, then the production, distribution patterns promising to produce things that can be immediately sold. We often say that a company benefit or good, from the plant entrance queue to see the car pulling out of goods, that is, this truth.
Of course, this indicator is not as high as possible, we know that both inventories of raw materials, semi-finished products, but also including the finished products. From the raw materials are concerned, if inventory is too low, companies receiving large orders did not occur when rice on the situation, but from the perspective of the finished product, appropriate inventory on the market can cope with possible sudden demand, and in the hands-free goods will not be a moment missed opportunities.
Haidian District, Beijing shareholders Ms Lau: How to analyze the inventory turnover rate of listed companies?
Zhang Q: I have mentioned above, the general application of this indicator, the following to say it's tips. Once I was a financial analysis of listed companies, has identified an interesting phenomenon, a state-owned group of companies in Shanghai stock market has 34 listed companies, these listed companies have a common characteristic, that is, the proportion of liquid assets is particularly high, averaging 70 %, inventory and accounts receivable which again occupy the majority of current assets.
This is a major shareholder of misappropriating company funds listed on a typical example. As the major shareholders and listed companies are manufacturers of electronic devices, large shareholders of listed companies to use their own funds to purchase a wholly-owned subsidiary of raw materials, reflected in the statements of listed companies is the increase in inventory, in the main cost is the case , its inventory turnover rate has dropped. Therefore, investors in analyzing this indicator, the best the industry with the same compared to other listed companies, which is horizontal in order to find some clues when comparing.
