American Water Works (AWK)
Return on equity (ROE)
| 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 stockholders’ equity | US$ in thousands | 10,332,000 | 9,797,000 | 7,693,000 | 7,298,000 | 6,454,000 |
| ROE | 10.17% | 9.64% | 10.66% | 17.31% | 10.99% |
December 31, 2024 calculation
ROE = Net income ÷ Total stockholders’ equity
= $1,051,000K ÷ $10,332,000K
= 10.17%
American Water Works' return on equity (ROE) has shown fluctuations over the years. At the end of December 31, 2020, the ROE was 10.99%, which increased significantly to 17.31% by December 31, 2021, indicating improved profitability and efficiency in generating returns for shareholders. However, in the following years, the ROE declined, reaching 10.66% by December 31, 2022, 9.64% by December 31, 2023, and increasing slightly to 10.17% by December 31, 2024.
The increasing trend in ROE from 2020 to 2021 suggests initial positive developments, but the subsequent decline in the metric indicates challenges that the company may have faced in sustaining its profitability and generating returns on equity for shareholders. The fluctuating nature of ROE may indicate changes in the company's financial management, asset utilization, debt levels, or overall business performance over the period analyzed. Further analysis of the company's financial statements and operational strategies would be required to provide more insights into the factors impacting American Water Works' return on equity.
Peer comparison
Dec 31, 2024