Chemed Corp (CHE)

Return on equity (ROE)

		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	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Net income (ttm)	US$ in thousands	272,509	244,582	226,497	239,576	249,624	262,123	277,253	267,319	268,550	307,677	303,396	328,975	319,466	271,294	262,519	231,147	219,923	208,671	200,973	205,215
Total stockholders’ equity	US$ in thousands	1,107,880	1,019,240	952,079	880,053	798,715	721,416	684,960	666,705	623,273	779,719	870,774	928,884	901,200	801,408	750,696	683,601	726,608	672,380	618,569	588,010
ROE		24.60%	24.00%	23.79%	27.22%	31.25%	36.33%	40.48%	40.10%	43.09%	39.46%	34.84%	35.42%	35.45%	33.85%	34.97%	33.81%	30.27%	31.03%	32.49%	34.90%

December 31, 2023 calculation

ROE = Net income (ttm) ÷ Total stockholders’ equity
= $272,509K ÷ $1,107,880K
= 24.60%

Chemed Corp.'s return on equity (ROE) has shown a declining trend over the past eight quarters, starting at 40.48% in Q2 2022 and decreasing to 24.60% in Q4 2023. This indicates that the company's ability to generate profits from shareholders' equity has been gradually diminishing.

The decreasing trend in ROE may raise concerns among investors and stakeholders regarding Chemed Corp.'s efficiency in utilizing shareholders' funds to generate earnings. It suggests that the company may be experiencing challenges in effectively managing its assets and liabilities to maximize profitability.

It is important for Chemed Corp.'s management to closely examine the factors contributing to the decline in ROE and take necessary actions to improve the company's financial performance and restore investor confidence. Strategies to enhance operational efficiency, control costs, optimize capital structure, and improve overall profitability may be imperative in reversing the downward trend in ROE.