Adapthealth Corp (AHCO)
Return on equity (ROE)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Net income | US$ in thousands | -678,895 | 69,316 | 156,175 | -161,632 | -21,341 |
| Total stockholders’ equity | US$ in thousands | 1,458,450 | 2,151,160 | 2,061,910 | 354,889 | -14,520 |
| ROE | -46.55% | 3.22% | 7.57% | -45.54% | — |
December 31, 2023 calculation
ROE = Net income ÷ Total stockholders’ equity
= $-678,895K ÷ $1,458,450K
= -46.55%
AdaptHealth Corp's return on equity (ROE) has exhibited significant fluctuations over the past five years. In 2023, the company's ROE stood at -46.55%, indicating a negative return on shareholders' equity, implying that the company's net income was insufficient to generate a positive return for shareholders. This sharp decline in ROE from the prior year's 2.95% raises concerns about the company's profitability and efficiency in utilizing shareholder funds.
The ROE improved in 2022 to 2.95%, signaling a modest return for equity investors. However, this figure remains relatively low compared to industry benchmarks and may suggest challenges in generating profits relative to the level of equity investment. The positive trend seen from 2021 where the ROE was 6.88% demonstrated a better utilization of shareholders' equity to generate returns.
In contrast, the ROE was notably negative in 2020 at -45.54%, reflecting a particularly poor performance in that year. This negative ROE could be attributed to factors such as losses or low profitability relative to the equity base. Unfortunately, the ROE data for 2019 is not available for comparison.
Overall, the fluctuating trend in AdaptHealth Corp's ROE highlights the company's varying ability to generate returns for equity investors over the years. Investors and analysts should closely monitor future ROE figures to assess the company's profitability and efficiency in utilizing shareholders' equity.
Peer comparison
Dec 31, 2023