Gilead Sciences Inc (GILD)

Return on equity (ROE)

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Net income	US$ in thousands	480,000	5,665,000	4,592,000	6,225,000	89,000
Total stockholders’ equity	US$ in thousands	19,330,000	22,833,000	21,209,000	21,064,000	18,221,000
ROE		2.48%	24.81%	21.65%	29.55%	0.49%

December 31, 2024 calculation

ROE = Net income ÷ Total stockholders’ equity
= $480,000K ÷ $19,330,000K
= 2.48%

The return on equity (ROE) for Gilead Sciences Inc has shown significant fluctuations over the past five years.

1. In December 2020, the ROE was a meager 0.49%, indicating that the company generated very low returns for its shareholders relative to its equity base.

2. The following year, in December 2021, there was a substantial improvement in ROE to 29.55%. This sharp increase suggests that the company significantly boosted its profit generation in relation to its equity during this period.

3. By December 2022, the ROE remained relatively high at 21.65%, indicating that Gilead Sciences continued to deliver strong returns to its shareholders compared to its equity base.

4. In December 2023, the ROE further increased to 24.81%. This suggests that the company effectively utilized its equity to generate profits and create value for its shareholders.

5. However, by December 2024, the ROE dropped notably to 2.48%, signaling a significant decline in the company's ability to generate returns on its equity compared to the previous year.

Overall, while Gilead Sciences Inc has shown variations in its ROE over the five-year period, the company experienced both periods of strong profitability relative to its equity and times of lower returns. It is essential for stakeholders to monitor these fluctuations closely to assess the company's performance and the effectiveness of its equity utilization strategies.