Harley-Davidson Inc (HOG)
Return on equity (ROE)
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Net income | US$ in thousands | 455,357 | 706,586 | 741,408 | 650,024 | 1,298 |
| Total stockholders’ equity | US$ in thousands | 773,378 | 3,252,810 | 2,906,810 | 2,553,240 | 1,722,780 |
| ROE | 58.88% | 21.72% | 25.51% | 25.46% | 0.08% |
December 31, 2024 calculation
ROE = Net income ÷ Total stockholders’ equity
= $455,357K ÷ $773,378K
= 58.88%
To analyze Harley-Davidson Inc's return on equity (ROE) based on the provided data:
1. Trend Analysis: The ROE has shown a significant improvement over the years, starting at a modest 0.08% on December 31, 2020, and steadily increasing to 58.88% by December 31, 2024.
2. Profitability: The increasing trend in ROE indicates that Harley-Davidson has been effectively utilizing shareholder equity to generate profits. This suggests that the company is becoming more efficient and profitable in its operations.
3. Financial Health: A high ROE signals that the company is generating substantial profits relative to its shareholder equity. This can be an indicator of financial strength and sustainability.
4. Factors Impacting ROE: The sharp rise in ROE from 2023 to 2024 could be attributed to improved operational efficiency, cost management, increased sales, or better utilization of assets.
5. Investor Perspective: A consistently high ROE can attract investors seeking companies that generate considerable returns on their investments, indicating potential value creation.
In conclusion, the upward trend in Harley-Davidson Inc's ROE reflects positive financial performance and efficiency in utilizing shareholder equity. It suggests the company's ability to generate returns for investors and indicates a favorable outlook for its financial health and profitability.
Peer comparison
Dec 31, 2024