American Electric Power Company Inc (AEP)

Return on assets (ROA)

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Net income	US$ in thousands	2,208,100	2,307,200	2,488,100	2,200,100	1,921,100
Total assets	US$ in thousands	96,684,000	93,403,300	87,668,700	80,757,200	75,892,300
ROA		2.28%	2.47%	2.84%	2.72%	2.53%

December 31, 2023 calculation

ROA = Net income ÷ Total assets
= $2,208,100K ÷ $96,684,000K
= 2.28%

American Electric Power Company Inc.'s return on assets (ROA) has shown a slight decline over the past five years, decreasing from 2.53% in 2019 to 2.28% in 2023. This downward trend could indicate potential inefficiencies in the company's asset utilization or declining profitability. However, it is worth noting that the ROA has fluctuated within a relatively narrow range of 2.28% to 2.84% over this period, suggesting a level of stability in the company's ability to generate profits relative to its total assets.

While ROA measures the company's ability to generate earnings from its assets, a downward trend in this ratio may warrant further investigation into the company's asset management strategies, operational efficiency, or changes in the industry landscape that could be impacting its profitability. Additional financial and operational metrics should be considered in conjunction with ROA to provide a comprehensive analysis of American Electric Power Company Inc.'s overall performance.