American Water Works (AWK)
Return on assets (ROA)
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Net income | US$ in thousands | 1,051,000 | 944,000 | 820,000 | 1,263,000 | 709,000 |
| Total assets | US$ in thousands | 32,830,000 | 30,298,000 | 27,787,000 | 26,075,000 | 24,766,000 |
| ROA | 3.20% | 3.12% | 2.95% | 4.84% | 2.86% |
December 31, 2024 calculation
ROA = Net income ÷ Total assets
= $1,051,000K ÷ $32,830,000K
= 3.20%
Based on the provided data, American Water Works' return on assets (ROA) has shown variability over the past five years. In December 31, 2020, the ROA was 2.86%, indicating that for every dollar of assets, the company generated a return of 2.86 cents. This figure increased to 4.84% by December 31, 2021, reflecting an improvement in the company's efficiency in utilizing its assets to generate profit.
However, there was a slight decline in ROA to 2.95% by December 31, 2022, before bouncing back to 3.12% by December 31, 2023, showing some fluctuation in the company's asset utilization and profitability. By December 31, 2024, the ROA further improved to 3.20%, indicating that American Water Works continued to enhance its ability to generate earnings from its asset base.
Overall, American Water Works' ROA performance demonstrates a mix of ups and downs over the past five years, with the company experiencing fluctuations in its asset profitability ratios. It will be essential for stakeholders to monitor these trends closely to assess the company's efficiency in generating returns relative to its asset base.
Peer comparison
Dec 31, 2024