Kontoor Brands Inc (KTB)

Return on equity (ROE)

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Net income	US$ in thousands	230,994	245,493	195,423	67,923	96,654
Total stockholders’ equity	US$ in thousands	371,913	250,757	148,138	84,641	69,257
ROE		62.11%	97.90%	131.92%	80.25%	139.56%

December 31, 2023 calculation

ROE = Net income ÷ Total stockholders’ equity
= $230,994K ÷ $371,913K
= 62.11%

The return on equity (ROE) for Kontoor Brands Inc has exhibited significant fluctuations over the past five years. In 2019, the ROE was the highest at 139.56%, indicating that for every dollar of shareholders' equity, the company generated a net income of $1.40. Subsequently, in 2021, the ROE decreased to 131.92%, still maintaining a relatively high return for shareholders.

However, there was a notable drop in ROE in 2022 to 97.90%, suggesting a decline in profitability and efficiency in generating returns for equity holders. This trend continued in 2023, with the ROE falling further to 62.11%, indicating a significant decrease in the company's ability to generate profits from shareholders' investments.

The decreasing trend in ROE over the past two years may raise concerns about the company's operational performance and efficiency in managing its assets and liabilities to generate profits. Investors and analysts may want to delve deeper into the factors contributing to this decline to assess the company's future financial sustainability and growth prospects.