Entergy Corporation (ETR)
Operating return on assets (Operating ROA)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Operating income | US$ in thousands | 2,617,980 | 2,050,780 | 1,845,630 | 1,390,500 | 469,365 |
| Total assets | US$ in thousands | 59,703,400 | 58,595,200 | 59,454,200 | 51,723,900 | 48,275,100 |
| Operating ROA | 4.38% | 3.50% | 3.10% | 2.69% | 0.97% |
December 31, 2023 calculation
Operating ROA = Operating income ÷ Total assets
= $2,617,980K ÷ $59,703,400K
= 4.38%
Operating return on assets (operating ROA) measures a company's ability to generate profits from its operating activities relative to its total assets. Looking at Entergy Corp.'s operating ROA over the past five years, we observe a fluctuating trend. The operating ROA increased from 3.20% in 2019 to 3.55% in 2021 before declining slightly to 3.22% in 2022. However, in 2023, Entergy Corp. experienced a notable improvement in its operating ROA, reaching 4.46%.
This increase in operating ROA in 2023 indicates that Entergy Corp. was more efficient in generating operating income from its assets compared to the previous year. It suggests that the company's operating activities were more profitable and effective in utilizing its asset base to drive earnings.
Overall, the upward trend in operating ROA from 2020 to 2023 reflects positively on Entergy Corp.'s operational performance and asset utilization efficiency. It indicates that the company has been able to enhance its operational profitability and productivity over the years, potentially through better cost management, revenue generation, or asset optimization strategies. Analyzing this metric over a multi-year period helps to assess the company's ability to generate returns from its core business operations relative to its asset base.
Peer comparison
Dec 31, 2023