Emerson Electric Company (EMR)
Operating return on assets (Operating ROA)
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|
| Operating income | US$ in thousands | 1,882,000 | 2,685,000 | 2,279,000 | 1,931,000 | 2,450,000 |
| Total assets | US$ in thousands | 42,746,000 | 35,672,000 | 24,715,000 | 22,882,000 | 20,497,000 |
| Operating ROA | 4.40% | 7.53% | 9.22% | 8.44% | 11.95% |
September 30, 2023 calculation
Operating ROA = Operating income ÷ Total assets
= $1,882,000K ÷ $42,746,000K
= 4.40%
The operating return on assets (operating ROA) of Emerson Electric Co. has shown a declining trend over the past five years. The operating ROA decreased from 15.22% in 2019 to 6.04% in 2023. This indicates a reduction in the company's ability to generate operating income from its assets.
The decline in operating ROA could be attributed to various factors such as declining operating income, changes in asset utilization, or a combination of both. It suggests that the company may be facing challenges in effectively utilizing its assets to generate operating income.
Further analysis of the company's financial performance, asset management efficiency, and operating income generation would be necessary to understand the specific reasons for the declining trend in operating ROA and to identify potential areas for improvement.
Peer comparison
Sep 30, 2023