Hilton Grand Vacations Inc (HGV)
Return on equity (ROE)
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Net income | US$ in thousands | 47,000 | 313,000 | 352,000 | 176,000 | -201,000 |
| Total stockholders’ equity | US$ in thousands | 1,752,000 | 2,115,000 | 2,151,000 | 1,988,000 | 374,000 |
| ROE | 2.68% | 14.80% | 16.36% | 8.85% | -53.74% |
December 31, 2024 calculation
ROE = Net income ÷ Total stockholders’ equity
= $47,000K ÷ $1,752,000K
= 2.68%
Over the five-year period from December 31, 2020, to December 31, 2024, Hilton Grand Vacations Inc's return on equity (ROE) exhibited fluctuations.
Initially, as of December 31, 2020, the company's ROE was notably negative at -53.74%. This suggests that the company's net income was insufficient to cover its shareholder's equity, indicating potential financial inefficiencies or heavy debt burden.
However, there was a significant improvement in the following years. By December 31, 2021, the ROE had turned positive, reaching 8.85%. This indicates a better utilization of shareholder's equity to generate profits compared to the previous year.
The positive trend continued into December 31, 2022, with the ROE increasing to 16.36%, indicating further enhancement in the company's profitability and efficiency in generating returns for its shareholders.
By December 31, 2023, the ROE slightly decreased to 14.80%, but it remained at a relatively healthy level, reflecting continued positive performance in utilizing shareholder's equity effectively to generate profits.
However, by December 31, 2024, the ROE declined significantly to 2.68%, suggesting a potential decrease in the company's profitability and effectiveness in generating returns for its shareholders compared to the previous year.
In conclusion, Hilton Grand Vacations Inc's ROE experienced fluctuations over the five-year period, exhibiting both positive and negative trends. It is essential for the company to assess and address the factors impacting its ROE to sustain and enhance shareholder value in the future.