Louisiana-Pacific Corporation (LPX)
Operating return on assets (Operating ROA)
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Operating income | US$ in thousands | 530,000 | 287,000 | 1,250,000 | 1,734,000 | 615,000 |
| Total assets | US$ in thousands | 2,569,000 | 2,437,000 | 2,350,000 | 2,194,000 | 2,086,000 |
| Operating ROA | 20.63% | 11.78% | 53.19% | 79.03% | 29.48% |
December 31, 2024 calculation
Operating ROA = Operating income ÷ Total assets
= $530,000K ÷ $2,569,000K
= 20.63%
Louisiana-Pacific Corporation's operating return on assets (Operating ROA) provides insight into the efficiency of the company in generating profits from its assets used in operations. Analyzing the trend from 2020 to 2024, we observe fluctuations in the Operating ROA:
- In 2020, the Operating ROA was 29.48%, indicating that the company generated $0.2948 in operating income for every dollar of assets employed.
- By the end of 2021, the Operating ROA significantly increased to 79.03%, signaling improved operational efficiency in utilizing assets to generate higher returns.
- In 2022, the Operating ROA slightly decreased to 53.19%, but remained at a relatively high level compared to the initial value in 2020.
- The trend reversed in 2023, with the Operating ROA dropping to 11.78%, reflecting a decline in efficiency in generating operating income from assets.
- By the close of 2024, the Operating ROA moderately recovered to 20.63%, though it remained below the peak observed in 2021.
The fluctuations in Operating ROA suggest varying levels of efficiency in utilizing assets to generate operating income over the years. It is crucial for the company to focus on sustaining or improving Operating ROA to enhance profitability and overall operational performance.
Peer comparison
Dec 31, 2024