Insteel Industries Inc (IIIN)
Operating return on assets (Operating ROA)
| Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Operating income (ttm) | US$ in thousands | 19,231 | 20,356 | 25,291 | 23,207 | 33,957 | 59,870 | 97,256 | 141,350 | 130,790 | 128,727 | 102,640 | 51,887 | 50,667 | 30,337 | 13,837 | 20,015 | 21,549 | 10,012 | 5,404 | 508 |
| Total assets | US$ in thousands | 422,552 | 414,615 | 397,227 | 390,568 | 447,513 | 445,382 | 428,224 | 423,756 | 471,745 | 481,048 | 420,558 | 368,779 | 390,710 | 371,931 | 336,861 | 309,951 | 337,902 | 336,690 | 319,035 | 306,451 |
| Operating ROA | 4.55% | 4.91% | 6.37% | 5.94% | 7.59% | 13.44% | 22.71% | 33.36% | 27.72% | 26.76% | 24.41% | 14.07% | 12.97% | 8.16% | 4.11% | 6.46% | 6.38% | 2.97% | 1.69% | 0.17% |
September 30, 2024 calculation
Operating ROA = Operating income (ttm) ÷ Total assets
= $19,231K ÷ $422,552K
= 4.55%
Operating return on assets (ROA) is a key financial ratio that measures a company's ability to generate operating income from its assets. Insteel Industries Inc's operating ROA has fluctuated over the past five quarters, ranging from 0.17% in the fourth quarter of 2019 to a high of 33.36% in the fourth quarter of 2022. The operating ROA for the latest quarter, ending September 30, 2024, is reported at 4.55%.
The declining trend in operating ROA from the peak in the fourth quarter of 2022 may indicate challenges in maintaining profitability relative to the level of assets employed. The significant decrease in operating ROA from the fourth quarter of 2022 to the first quarter of 2023, from 33.36% to 22.71%, followed by further declines in subsequent quarters, raises concerns about the company's operational efficiency and asset utilization.
It is important for Insteel Industries Inc to closely monitor and address the factors contributing to the fluctuations in operating ROA to improve overall profitability. This may involve optimizing the use of assets, controlling operating expenses, and enhancing revenue generation strategies. Additionally, considering industry benchmarks and peer comparisons could provide valuable insights into the company's operational performance and help identify areas for improvement.
Peer comparison
Sep 30, 2024