Centene Corp (CNC)
Operating return on assets (Operating ROA)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Operating income | US$ in thousands | 2,930,000 | 1,318,000 | 1,784,000 | 3,082,000 | 1,781,000 |
| Total assets | US$ in thousands | 84,641,000 | 76,870,000 | 78,375,000 | 68,719,000 | 40,994,000 |
| Operating ROA | 3.46% | 1.71% | 2.28% | 4.48% | 4.34% |
December 31, 2023 calculation
Operating ROA = Operating income ÷ Total assets
= $2,930,000K ÷ $84,641,000K
= 3.46%
Centene Corp.'s operating return on assets (operating ROA) has shown a decreasing trend over the past five years. The ratio stood at 5.01% in 2019 and has since declined to 4.09% in 2023. This indicates that the company's ability to generate operating income from its assets has been gradually weakening.
Although a higher operating ROA is generally preferred, it is essential to consider the reasons behind the fluctuation in the ratio. A declining operating ROA could be attributed to various factors such as increasing operating expenses, inefficiencies in operations, or a decrease in asset turnover.
Further analysis, including evaluating the components of operating income and total assets, is necessary to gain a deeper understanding of the factors influencing Centene Corp.'s operating ROA. It is important for investors and stakeholders to closely monitor this ratio to assess the company's profitability and efficiency in utilizing its assets effectively.
Peer comparison
Dec 31, 2023