Cars.com Inc (CARS)

Return on equity (ROE)

Dec 31, 2024 Sep 30, 2024 Jun 30, 2024 Mar 31, 2024 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
Net income (ttm) US$ in thousands 48,188 39,230 25,002 107,747 118,442 120,358 112,926 24,345 17,206 988 6,360 6,781 7,719 20,894 6,202 -24,408 -817,120 -828,449 -1,242,345 -1,223,727
Total stockholders’ equity US$ in thousands 511,485 502,425 496,891 481,450 492,108 483,010 477,457 384,987 384,430 376,527 391,388 396,087 366,934 366,560 357,442 346,002 340,176 322,373 328,781 347,890
ROE 9.42% 7.81% 5.03% 22.38% 24.07% 24.92% 23.65% 6.32% 4.48% 0.26% 1.62% 1.71% 2.10% 5.70% 1.74% -7.05% -240.21% -256.98% -377.86% -351.76%

December 31, 2024 calculation

ROE = Net income (ttm) ÷ Total stockholders’ equity
= $48,188K ÷ $511,485K
= 9.42%

Cars.com Inc's return on equity (ROE) experienced a significant improvement over the past few quarters. From a negative ROE in the range of -351.76% to -377.86% in the first half of 2020, the company managed to steadily enhance its performance. ROE improved to -7.05% by the first quarter of 2021 and turned positive, reaching 1.74% by the second quarter of the same year. The positive trend continued, with ROE further increasing to 5.70% by the third quarter of 2021 and 2.10% by the end of that year.

In the subsequent quarters, Cars.com Inc sustained its growth in ROE, achieving 6.32% by the first quarter of 2023, and witnessing a significant peak at 24.92% by the third quarter of the same year. The company maintained a strong ROE level above 20% for several consecutive quarters, indicating efficient utilization of shareholders' equity to generate profits.

However, a slight decline was observed by the end of 2024, with ROE falling to 9.42% from the peak levels seen earlier. Despite this decrease, the company maintained a healthy ROE above industry averages, reflecting the ability to generate higher profits relative to its equity base.

Overall, the positive trajectory of Cars.com Inc's return on equity signals improved profitability and efficiency in utilizing shareholders' investments in driving earnings growth.