Applied Materials Inc (AMAT)
Return on assets (ROA)
| Oct 29, 2023 | Oct 30, 2022 | Oct 31, 2021 | Oct 25, 2020 | Oct 27, 2019 | ||
|---|---|---|---|---|---|---|
| Net income | US$ in thousands | 6,856,000 | 6,525,000 | 5,888,000 | 3,619,000 | 2,706,000 |
| Total assets | US$ in thousands | 30,729,000 | 26,726,000 | 25,825,000 | 22,353,000 | 19,024,000 |
| ROA | 22.31% | 24.41% | 22.80% | 16.19% | 14.22% |
October 29, 2023 calculation
ROA = Net income ÷ Total assets
= $6,856,000K ÷ $30,729,000K
= 22.31%
Based on the data provided, Applied Materials Inc.'s return on assets (ROA) has shown a generally positive trend over the past five years. The ROA for the most recent fiscal year (Oct 29, 2023) was 22.31%, a slight decrease from the previous year's 24.41%. However, it remains higher than the ROA reported in the fiscal years 2021, 2020, and 2019, reflecting the company's ability to generate more profit from its assets.
ROA is a key financial ratio that measures a company's efficiency in utilizing its assets to generate profits. A higher ROA indicates that the company is utilizing its assets more efficiently to generate profits.
The consistent improvement in ROA from 14.22% in 2019 to 22.31% in 2023 indicates that Applied Materials Inc. has been effectively managing its assets to generate increasing returns for its shareholders. This trend suggests that the company has been able to enhance its operational efficiency and profitability over the years.
It's worth noting that while the 2023 ROA is slightly lower than the previous year, it still reflects a strong performance in terms of generating profits from its assets. Investors and stakeholders may find this trend favorable, as it indicates that the company is using its assets more effectively to generate earnings.
Overall, the trend in Applied Materials Inc.'s ROA suggests that the company has been successful in improving its asset utilization and generating higher returns for its investors over the past five years. However, it will be important to continue monitoring this ratio to ensure that the positive trend in asset efficiency and profitability is sustained in the future.
Peer comparison
Oct 29, 2023