Laboratory Corporation of America Holdings (LH)
Return on assets (ROA)
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Net income | US$ in thousands | 746,000 | 418,000 | 1,279,100 | 2,377,300 | 1,556,100 |
| Total assets | US$ in thousands | 18,379,000 | 16,725,100 | 20,155,100 | 20,385,400 | 20,071,700 |
| ROA | 4.06% | 2.50% | 6.35% | 11.66% | 7.75% |
December 31, 2024 calculation
ROA = Net income ÷ Total assets
= $746,000K ÷ $18,379,000K
= 4.06%
Laboratory Corporation of America Holdings' return on assets (ROA) has fluctuated over the past five years, from 7.75% as of December 31, 2020, to 4.06% as of December 31, 2024. The ROA indicates the company's ability to generate profit from its assets.
The significant increase in ROA from 2020 to 2021, rising to 11.66%, suggests improved efficiency in asset utilization and increased profitability. However, this trend reversed in the following years, with ROA declining to 6.35% in 2022, 2.50% in 2023, and 4.06% in 2024.
The decreasing ROA in the latter years may indicate challenges in effectively managing the company's assets to generate profit. It is essential for the company to evaluate and potentially optimize its asset allocation strategies to improve ROA and enhance overall financial performance in the future.
Peer comparison
Dec 31, 2024