LGI Homes (LGIH)

Operating return on assets (Operating ROA)

		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	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Operating income (ttm)	US$ in thousands	233,255	214,217	226,518	320,438	390,107	490,613	533,974	520,975	547,698	571,945	511,448	433,275	364,710	283,150	269,734	260,341	227,538	198,970	186,595	190,316
Total assets	US$ in thousands	3,407,850	3,335,010	3,139,540	3,100,920	3,124,830	3,112,800	2,873,360	2,594,230	2,351,860	2,153,560	2,058,840	1,825,490	1,826,090	1,762,840	1,636,380	1,719,040	1,666,120	1,636,190	1,486,060	1,436,200
Operating ROA		6.84%	6.42%	7.22%	10.33%	12.48%	15.76%	18.58%	20.08%	23.29%	26.56%	24.84%	23.73%	19.97%	16.06%	16.48%	15.14%	13.66%	12.16%	12.56%	13.25%

December 31, 2023 calculation

Operating ROA = Operating income (ttm) ÷ Total assets
= $233,255K ÷ $3,407,850K
= 6.84%

LGI Homes Inc's operating return on assets (operating ROA) has been on a declining trend over the past eight quarters. The company's operating ROA decreased from 20.08% in Q1 2022 to 6.84% in Q4 2023. This indicates a significant drop over the period under review.

A decreasing trend in operating ROA signifies that the company's ability to generate profit from its assets used in operations has weakened over time. Factors contributing to this decline could include lower operating efficiency, increased operating expenses, or a decrease in revenue generated per dollar of assets.

It is important for investors and stakeholders to closely monitor this trend and understand the underlying reasons for the declining operating ROA to assess the company's operational efficiency and profitability prospects in the future.