Jazz Pharmaceuticals PLC (JAZZ)

Return on equity (ROE)

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Net income	US$ in thousands	560,120	414,832	-214,139	-328,954	238,616
Total stockholders’ equity	US$ in thousands	4,093,760	3,737,000	3,085,730	3,965,190	3,659,740
ROE		13.68%	11.10%	-6.94%	-8.30%	6.52%

December 31, 2024 calculation

ROE = Net income ÷ Total stockholders’ equity
= $560,120K ÷ $4,093,760K
= 13.68%

Analyzing Jazz Pharmaceuticals PLC's return on equity (ROE) over the past five years yields insightful trends. The company's ROE fluctuated significantly during this period, starting at 6.52% in December 2020. There was a sharp decline to -8.30% by December 2021, indicating a negative equity return that year.

Subsequently, the trend continued downward with an ROE of -6.94% by the end of 2022. However, there was a notable turnaround in December 2023 when Jazz Pharmaceuticals PLC's ROE rose to 11.10%, signifying a positive return on equity that year. This improvement was further enhanced by a substantial increase to 13.68% by December 2024, demonstrating a significant positive growth in equity returns.

The erratic performance in the initial years, followed by a remarkable recovery in the latter years, suggests that Jazz Pharmaceuticals PLC has experienced fluctuations in its profitability and efficiency in generating returns for its shareholders. The company's ability to sustain and enhance its ROE over time will be critical in assessing its long-term financial strength and shareholder value creation.