Aramark Holdings (ARMK)

Return on equity (ROE)

		Sep 30, 2024	Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020
Net income	US$ in thousands	262,522	674,108	194,484	-90,833	-461,529
Total stockholders’ equity	US$ in thousands	3,038,970	3,712,720	3,029,640	2,722,870	2,735,990
ROE		8.64%	18.16%	6.42%	-3.34%	-16.87%

September 30, 2024 calculation

ROE = Net income ÷ Total stockholders’ equity
= $262,522K ÷ $3,038,970K
= 8.64%

The return on equity (ROE) of Aramark Holdings has shown fluctuations over the past five years. In September 2024, the ROE was 8.64%, a decrease from the prior year's 18.16%. This decrease indicates a lower profitability relative to the equity invested in the business.

In the preceding year, the ROE was 6.42%, showing a slight improvement from the negative ROE of -3.34% in September 2021. The negative ROE in 2021 suggests that the company's net income was insufficient to cover the shareholders' equity, resulting in a loss.

Aramark Holdings also experienced a significant downturn in ROE in September 2020, with a negative ROE of -16.87%. This indicates a substantial loss relative to the equity invested in the business during that period.

Overall, the trend in Aramark Holdings' ROE over the past five years shows variability and inconsistency in profitability and efficiency in generating returns for shareholders. It is crucial for the company to implement strategies to improve profitability and effectively utilize shareholder equity to enhance long-term value creation.