Ciena Corp (CIEN)
Return on equity (ROE)
| Oct 28, 2023 | Oct 29, 2022 | Oct 30, 2021 | Oct 31, 2020 | Oct 31, 2017 | ||
|---|---|---|---|---|---|---|
| Net income | US$ in thousands | 254,827 | 152,902 | 500,196 | 361,291 | 1,261,950 |
| Total stockholders’ equity | US$ in thousands | 2,848,360 | 2,712,860 | 3,020,020 | 2,509,600 | 2,136,340 |
| ROE | 8.95% | 5.64% | 16.56% | 14.40% | 59.07% |
October 28, 2023 calculation
ROE = Net income ÷ Total stockholders’ equity
= $254,827K ÷ $2,848,360K
= 8.95%
Based on the data provided, CIENA Corp.'s return on equity (ROE) has exhibited some variability over the past five years. In the most recent fiscal year, ending on October 28, 2023, the ROE was 8.95%, which represents an increase from the previous year's figure of 5.64% (as of October 29, 2022). Despite this improvement, the current ROE remains lower than the levels seen in the earlier years, such as the 16.56% recorded on October 30, 2021, and the 14.40% on October 31, 2020. It should be noted that the ROE was also relatively strong on October 31, 2019, standing at 11.66%.
This fluctuation in ROE suggests that CIENA Corp.'s ability to generate profits from shareholders' equity has not been consistent over this period. The company should delve into the underlying factors contributing to these changes, such as variations in net income, asset utilization, and equity structure, in order to gain insights into the drivers of its ROE and to identify areas for improvement. Additionally, as ROE is an important measure of a company's profitability and efficiency in utilizing shareholder capital, CIENA Corp. should continue to monitor this ratio closely and work towards sustaining or enhancing its return on equity in the future.
Peer comparison
Oct 28, 2023