Goodyear Tire & Rubber Co (GT)
Return on equity (ROE)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Net income | US$ in thousands | -689,000 | 202,000 | 764,000 | -1,254,000 | -311,000 |
| Total stockholders’ equity | US$ in thousands | 4,668,000 | 5,300,000 | 4,999,000 | 3,078,000 | 4,351,000 |
| ROE | -14.76% | 3.81% | 15.28% | -40.74% | -7.15% |
December 31, 2023 calculation
ROE = Net income ÷ Total stockholders’ equity
= $-689,000K ÷ $4,668,000K
= -14.76%
The return on equity (ROE) of Goodyear Tire & Rubber Co. has varied significantly over the past five years. In 2023, the ROE was negative at -14.76%, indicating that the company generated a loss on shareholders' equity for that year. This represents a sharp decline from the previous year when the ROE was 3.81%, albeit still low.
In 2021, the ROE rebounded to 15.28%, indicating a strong performance and a satisfactory return on equity for shareholders. However, in 2020, the ROE was severely negative at -40.74%, reflecting a significant loss on shareholders' equity, possibly due to adverse financial conditions or operational challenges.
The ROE in 2019 was also negative at -7.15%, suggesting that the company struggled to generate a positive return on equity for two consecutive years.
Overall, the fluctuating ROE of Goodyear Tire & Rubber Co. indicates inconsistency in its financial performance and efficiency in utilizing shareholders' equity to generate profits. Investors and stakeholders may need to closely monitor the company's financial health and management strategies to assess its future profitability and sustainability.