DXP Enterprises Inc (DXPE)
Operating return on assets (Operating ROA)
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Operating income | US$ in thousands | 145,382 | 139,322 | 64,694 | 13,128 | 10,256 |
| Total assets | US$ in thousands | 1,349,490 | 1,177,440 | 1,037,280 | 906,192 | 851,861 |
| Operating ROA | 10.77% | 11.83% | 6.24% | 1.45% | 1.20% |
December 31, 2024 calculation
Operating ROA = Operating income ÷ Total assets
= $145,382K ÷ $1,349,490K
= 10.77%
Operating Return on Assets (Operating ROA) is a key financial ratio that measures a company's ability to generate operating profits relative to its total assets.
Analyzing DXP Enterprises Inc's Operating ROA from December 31, 2020, to December 31, 2024, reveals a fluctuating trend. The ratio increased from 1.20% in 2020 to 1.45% in 2021, indicating a modest improvement in the company's ability to generate operating profits per dollar of assets.
A significant leap was seen in 2022 when DXP Enterprises Inc's Operating ROA surged to 6.24%, representing a substantial improvement over the previous year. This suggests that the company significantly increased its operating profitability in relation to its asset base.
The positive trend continued in 2023 with an even more impressive Operating ROA of 11.83%, indicating a robust performance in generating operating profits compared to the assets employed by the company.
However, in 2024, there was a slight decrease in the Operating ROA to 10.77%, although still at a high level. This may imply a potential decrease in the company's operating efficiency in converting assets into profits compared to the prior year.
Overall, the upward trend in DXP Enterprises Inc's Operating ROA from 2020 to 2023 reflects the company's improved efficiency in generating operating profits per dollar of assets. However, the slight decline in 2024 suggests the need for continued monitoring to ensure sustainable profitability.
Peer comparison
Dec 31, 2024