Liquidity Services Inc (LQDT)

Return on equity (ROE)

		Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020	Sep 30, 2019
Net income	US$ in thousands	20,978	40,324	50,949	-3,774	-19,260
Total stockholders’ equity	US$ in thousands	161,533	154,536	135,015	111,815	116,175
ROE		12.99%	26.09%	37.74%	-3.38%	-16.58%

September 30, 2023 calculation

ROE = Net income ÷ Total stockholders’ equity
= $20,978K ÷ $161,533K
= 12.99%

Liquidity Services Inc's return on equity (ROE) has exhibited variability over the past five years. In Sep 30, 2023, the ROE stood at 12.99%, reflective of a decrease from the previous year's 26.09%. This decline is notable, as it indicates a reduction in the company's ability to generate profits from the equity invested by shareholders. The phenomenon of declining ROE over the past two years may raise concerns regarding the company's operational efficiency and its ability to generate sustainable returns for shareholders. However, it's noteworthy that the ROE has fluctuated significantly in the previous years, with a substantial increase from -3.38% in 2020 to 37.74% in 2021. This trend suggests potential volatility in the company's profitability and efficiency in utilizing shareholders' equity. Further analysis of the company's financial and operational strategies is warranted to gain a comprehensive understanding of the factors driving this fluctuation in ROE.