Franklin Electric Co Inc (FELE)
Operating return on assets (Operating ROA)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Operating income | US$ in thousands | 262,441 | 257,189 | 189,200 | 130,500 | 127,133 |
| Total assets | US$ in thousands | 1,728,100 | 1,694,200 | 1,575,200 | 1,272,300 | 1,194,700 |
| Operating ROA | 15.19% | 15.18% | 12.01% | 10.26% | 10.64% |
December 31, 2023 calculation
Operating ROA = Operating income ÷ Total assets
= $262,441K ÷ $1,728,100K
= 15.19%
Over the past five years, Franklin Electric Co., Inc.'s operating return on assets (ROA) has shown a positive trend, increasing from 10.85% in 2019 to 15.25% in 2023. This indicates that the company has been able to generate more operating income relative to its total assets over the years.
The improvement in operating ROA suggests that Franklin Electric has become more efficient in utilizing its assets to generate operating profits. This could be a result of better operational management, increased productivity, cost control measures, or strategic investments that have enhanced the company's profitability.
A consistently high operating ROA, as demonstrated by Franklin Electric, is a positive indicator of the company's overall operational efficiency and profitability. It suggests that Franklin Electric is effectively using its assets to generate income, which is crucial for sustaining and growing the business in the long term.
Investors and stakeholders may view the increasing trend in operating ROA favorably, as it indicates that the company is performing well in terms of generating operating profits relative to its asset base. It also reflects positively on the management's ability to drive efficiency and profitability within the organization.
Peer comparison
Dec 31, 2023