Baxter International Inc (BAX)

Return on assets (ROA)

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Net income	US$ in thousands	2,656,000	-2,433,000	1,284,000	1,102,000	1,001,000
Total assets	US$ in thousands	28,276,000	28,287,000	33,521,000	20,019,000	18,193,000
ROA		9.39%	-8.60%	3.83%	5.50%	5.50%

December 31, 2023 calculation

ROA = Net income ÷ Total assets
= $2,656,000K ÷ $28,276,000K
= 9.39%

Return on assets (ROA) is a key financial ratio that measures a company's efficiency in generating profits from its assets. Baxter International Inc.'s ROA has shown variability over the past five years. In 2023, the company's ROA improved significantly to 9.39%, indicating that Baxter was able to generate a higher level of profits relative to its total assets compared to the previous year.

In 2022, Baxter International Inc. experienced a negative ROA of -8.60%, suggesting that the company incurred a significant loss relative to its asset base that year. The negative ROA could be attributed to various factors such as decreased profitability, inefficient asset utilization, or asset impairment.

In 2021, Baxter's ROA was 3.83%, demonstrating an improvement from the previous year but still lower than the levels achieved in 2019 and 2020. This suggests that the company was able to generate a moderate level of profit relative to its asset base during the year.

In both 2020 and 2019, Baxter International Inc. maintained a consistent ROA of 5.50%, indicating that the company was able to efficiently utilize its assets to generate profits during those years.

Overall, Baxter International Inc.'s ROA performance has shown variability over the past five years, with a significant improvement in 2023, contrasting with a negative ROA in 2022. It is essential for investors and analysts to further investigate the factors influencing these fluctuations to gain a better understanding of the company's financial performance and asset management strategies.