Leggett & Platt Incorporated (LEG)
Return on equity (ROE)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Net income | US$ in thousands | -136,800 | 309,800 | 402,400 | 253,000 | 314,000 |
| Total stockholders’ equity | US$ in thousands | 1,333,300 | 1,640,700 | 1,648,000 | 1,424,600 | 1,312,000 |
| ROE | -10.26% | 18.88% | 24.42% | 17.76% | 23.93% |
December 31, 2023 calculation
ROE = Net income ÷ Total stockholders’ equity
= $-136,800K ÷ $1,333,300K
= -10.26%
Analysis of Leggett & Platt, Inc.'s return on equity (ROE) reveals fluctuations over the past five years.
In 2023, the company experienced a negative ROE of -10.26%, indicating that its net income was insufficient to generate a positive return for shareholders based on their equity investment. This negative ROE could be attributed to various factors such as low profitability, high debt levels, or inefficient use of assets.
Contrastingly, in 2022, Leggett & Platt achieved a relatively strong ROE of 18.88%, showing an improvement from the previous year. This increase suggests that the company generated a respectable return on the equity invested by shareholders, reflecting efficient management of assets and profitability.
Moving back to 2021, the ROE stood at 24.42%, indicating a further improvement compared to 2022. This significant rise in ROE suggests that Leggett & Platt was able to enhance its profitability and operational efficiency, translating into higher returns for shareholders.
In 2020, the ROE was 17.82%, slightly lower than in 2021 but still showing a decent return on equity. This ROE level indicates that the company continued to generate satisfactory profits relative to shareholders' equity during the year.
Finally, in 2019, Leggett & Platt recorded an ROE of 25.44%, which was the highest among the five years analyzed. This indicates that the company was highly efficient in utilizing shareholder funds to generate profits and create value during that year.
Overall, Leggett & Platt's ROE has shown some variability over the past five years, reflecting fluctuations in the company's profitability and efficiency in generating returns for its shareholders. Management may need to assess the factors contributing to the negative ROE in 2023 to improve the company's financial performance and enhance shareholder value in the future.
Peer comparison
Dec 31, 2023