Generac Holdings Inc (GNRC)
Operating return on assets (Operating ROA)
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Operating income (ttm) | US$ in thousands | 386,199 | 342,459 | 325,206 | 456,078 | 566,330 | 634,583 | 720,639 | 686,747 | 721,136 | 716,709 | 698,767 | 605,368 | 479,106 | 412,560 | 362,479 | 363,852 | 372,163 | 376,503 | 377,466 | 372,007 |
| Total assets | US$ in thousands | 5,093,310 | 5,166,340 | 5,321,970 | 5,211,130 | 5,169,460 | 5,246,290 | 5,472,950 | 5,151,530 | 4,877,780 | 4,100,430 | 3,706,930 | 3,422,140 | 3,235,420 | 2,974,080 | 2,767,620 | 2,654,080 | 2,665,670 | 2,594,120 | 2,523,110 | 2,473,720 |
| Operating ROA | 7.58% | 6.63% | 6.11% | 8.75% | 10.96% | 12.10% | 13.17% | 13.33% | 14.78% | 17.48% | 18.85% | 17.69% | 14.81% | 13.87% | 13.10% | 13.71% | 13.96% | 14.51% | 14.96% | 15.04% |
December 31, 2023 calculation
Operating ROA = Operating income (ttm) ÷ Total assets
= $386,199K ÷ $5,093,310K
= 7.58%
Generac Holdings Inc's operating return on assets (ROA) has exhibited a downward trend over the past eight quarters, showcasing a decline from 13.75% in Q1 2022 to 7.59% in Q4 2023. This trend suggests that the company's ability to generate operating profits from its assets has weakened over time.
The diminishing operating ROA could indicate inefficiencies in the utilization of assets or a decrease in operational profitability. Factors influencing this decline may include rising costs, pricing pressures, lower demand for its products, or increased competition impacting the company's operating performance.
Generac Holdings Inc's management should further investigate the root causes of the decreasing operating ROA and consider implementing strategies to improve operational efficiency, enhance asset utilization, and boost profitability to reverse this downward trend in the long run. Monitoring and addressing these challenges promptly are essential for sustaining the company's financial health and ensuring long-term success.
Peer comparison
Dec 31, 2023