Estee Lauder Companies Inc (EL)

Return on assets (ROA)

		Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021	Jun 30, 2020
Net income	US$ in thousands	409,000	1,010,000	2,401,000	2,863,000	684,000
Total assets	US$ in thousands	21,677,000	23,415,000	20,910,000	21,971,000	17,781,000
ROA		1.89%	4.31%	11.48%	13.03%	3.85%

June 30, 2024 calculation

ROA = Net income ÷ Total assets
= $409,000K ÷ $21,677,000K
= 1.89%

The return on assets (ROA) for Estee Lauder Companies Inc has shown fluctuations over the past five years. In June 2024, the ROA stood at 1.89%, a significant decrease from the previous year's 4.31%. This decline indicates that the company's ability to generate profits from its assets has weakened compared to the prior year.

Looking further back, in June 2023, the ROA was 4.31%, showing a notable drop from the high of 11.48% in June 2022. The steep decline in ROA from 2022 to 2023 suggests a significant reduction in the company's efficiency in utilizing its assets to generate earnings.

In comparison, the ROA was at its peak in June 2022 at 11.48%, indicating a strong performance in asset utilization and profitability. The subsequent decrease in ROA in 2023 and 2024 could be a cause for concern, as it signifies a decline in the company's profitability relative to its asset base.

Overall, the fluctuations in Estee Lauder Companies Inc's ROA over the past five years highlight the importance of closely monitoring the company's asset management and profitability strategies to ensure sustainable and efficient operations.