Smith AO Corporation (AOS)
Return on equity (ROE)
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Net income (ttm) | US$ in thousands | 556,600 | 299,200 | 273,600 | 242,800 | 235,700 | 495,400 | 517,200 | 509,200 | 487,100 | 467,500 | 441,300 | 390,900 | 344,900 | 316,200 | 298,100 | 332,400 | 370,000 | 405,000 | 422,300 | 434,700 |
| Total stockholders’ equity | US$ in thousands | 1,844,400 | 1,882,400 | 1,888,400 | 1,790,200 | 1,747,700 | 1,747,800 | 1,792,500 | 1,808,900 | 1,832,200 | 1,896,500 | 1,816,300 | 1,849,000 | 1,848,300 | 1,747,100 | 1,658,100 | 1,616,300 | 1,666,800 | 1,656,200 | 1,725,100 | 1,749,200 |
| ROE | 30.18% | 15.89% | 14.49% | 13.56% | 13.49% | 28.34% | 28.85% | 28.15% | 26.59% | 24.65% | 24.30% | 21.14% | 18.66% | 18.10% | 17.98% | 20.57% | 22.20% | 24.45% | 24.48% | 24.85% |
December 31, 2023 calculation
ROE = Net income (ttm) ÷ Total stockholders’ equity
= $556,600K ÷ $1,844,400K
= 30.18%
The return on equity (ROE) of A.O. Smith Corp. has shown fluctuation over the past eight quarters. In Q4 2023, the ROE stood at 30.18%, representing a significant increase compared to the previous quarter's 15.89%. This indicates that the company generated a higher level of net income relative to its shareholder equity during this period.
The upward trend in ROE from Q2 2022 to Q4 2022, with figures ranging from 28.15% to 28.85%, suggests a period of strong performance where A.O. Smith Corp. efficiently utilized its equity to generate profits. However, the subsequent decrease in ROE in Q1 2023 to 13.56% followed by another decrease in Q2 2023 to 14.49% may raise concerns about the company's profitability and efficiency in using equity.
It is worth noting that the ROE in Q4 2023 rebounded significantly, surpassing the levels seen in the previous quarters. This improvement could signal a positive turn in the company's ability to generate profit from its shareholders' investments. Further monitoring of A.O. Smith Corp.'s financial performance will be necessary to determine the sustainability of this upward trend in ROE.
Peer comparison
Dec 31, 2023