Emerson Electric Company (EMR)
Operating return on assets (Operating ROA)
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | ||
|---|---|---|---|---|---|---|
| Operating income | US$ in thousands | 1,041,000 | 1,882,000 | 2,685,000 | 2,279,000 | 1,931,000 |
| Total assets | US$ in thousands | 44,246,000 | 42,746,000 | 35,672,000 | 24,715,000 | 22,882,000 |
| Operating ROA | 2.35% | 4.40% | 7.53% | 9.22% | 8.44% |
September 30, 2024 calculation
Operating ROA = Operating income ÷ Total assets
= $1,041,000K ÷ $44,246,000K
= 2.35%
Emerson Electric Company's operating return on assets (operating ROA) has shown a decreasing trend over the past five years, declining from 8.44% in 2020 to 2.35% in 2024. This decline may indicate inefficiencies in the company's operations and the utilization of its assets to generate operating profits.
A lower operating ROA suggests that the company is less effective in converting its assets into operating income. This could be attributed to various factors such as increased operating expenses, lower operating margins, or a decrease in asset turnover.
It is essential for Emerson Electric Company to closely monitor its operating ROA and work towards improving efficiency in asset utilization and operating profitability to enhance overall financial performance and shareholder value.
Peer comparison
Sep 30, 2024