Healthcare Services Group Inc (HCSG)
Return on assets (ROA)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Net income | US$ in thousands | 38,386 | 34,243 | 45,863 | 98,682 | 64,581 |
| Total assets | US$ in thousands | 790,652 | 720,836 | 777,529 | 785,031 | 722,592 |
| ROA | 4.85% | 4.75% | 5.90% | 12.57% | 8.94% |
December 31, 2023 calculation
ROA = Net income ÷ Total assets
= $38,386K ÷ $790,652K
= 4.85%
Healthcare Services Group, Inc.'s return on assets (ROA) has fluctuated over the past five years, as shown in the table. The ROA decreased from 8.94% in 2019 to 12.57% in 2020, indicating a significant improvement in asset utilization and profitability. However, in the following years, the ROA has trended downwards, dropping to 5.90% in 2021, 4.82% in 2022, and 4.85% in 2023.
This decline suggests that the company may be facing challenges in generating profits relative to its total assets. A decreasing ROA could be a cause for concern for investors and stakeholders, as it indicates a potential inefficiency in the company's asset management or declining profitability. Further analysis of the company's operations, financial health, and market conditions would be necessary to understand the underlying factors contributing to the declining ROA trend.