Graco Inc (GGG)

Return on equity (ROE)

Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Net income US$ in thousands 486,084 506,511 460,645 439,866 330,456
Total stockholders’ equity US$ in thousands 2,584,140 2,224,220 1,859,650 1,709,340 1,283,900
ROE 18.81% 22.77% 24.77% 25.73% 25.74%

December 31, 2024 calculation

ROE = Net income ÷ Total stockholders’ equity
= $486,084K ÷ $2,584,140K
= 18.81%

Graco Inc's return on equity (ROE) has shown a gradual decline over the past five years, starting at 25.74% as of December 31, 2020, and decreasing to 18.81% by December 31, 2024. This decreasing trend indicates that the company's ability to generate profits from shareholder equity has weakened over time.

The slight decrease in ROE from 2020 to 2021, followed by a more notable decline in the subsequent years, may suggest that Graco Inc's profitability and efficiency in utilizing shareholder funds have been facing challenges. A declining ROE could indicate issues such as rising expenses, lower profitability, or inefficient use of assets.

It is important for Graco Inc to closely monitor its ROE and investigate the factors contributing to this downward trend. Addressing any underlying issues affecting profitability and operational efficiency will be crucial for the company to improve its return on equity and enhance shareholder value in the future.