Now Inc (DNOW)

Return on equity (ROE)

Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Net income US$ in thousands 81,000 247,000 128,000 5,000 -427,000
Total stockholders’ equity US$ in thousands 1,128,000 1,060,000 842,000 712,000 699,000
ROE 7.18% 23.30% 15.20% 0.70% -61.09%

December 31, 2024 calculation

ROE = Net income ÷ Total stockholders’ equity
= $81,000K ÷ $1,128,000K
= 7.18%

Now Inc's return on equity (ROE) has shown a significant improvement over the analyzed period. The ROE was negative at -61.09% as of December 31, 2020, indicating that the company was not efficiently generating profits from its shareholders' equity. However, by December 31, 2021, the ROE increased to 0.70%, reflecting a turnaround in the company's profitability.

The trend continued positively, with the ROE rising to 15.20% by December 31, 2022, suggesting that Now Inc was able to generate a higher return on the shareholders' equity invested in the business. Subsequently, by December 31, 2023, the ROE further improved to 23.30%, indicating a more efficient utilization of equity to generate profits for shareholders.

However, there was a slight dip in the ROE to 7.18% as of December 31, 2024, which might indicate a decrease in profitability relative to the previous year. Overall, the positive trend in ROE from negative values to double-digit percentages showcases an improvement in Now Inc's ability to generate profit from shareholders' equity, although the fluctuation in the last reported year may warrant further investigation.