MGP Ingredients Inc (MGPI)
Return on equity (ROE)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Net income | US$ in thousands | 107,475 | 109,462 | 91,307 | 40,345 | 38,793 |
| Total stockholders’ equity | US$ in thousands | 850,492 | 746,724 | 644,755 | 262,526 | 231,044 |
| ROE | 12.64% | 14.66% | 14.16% | 15.37% | 16.79% |
December 31, 2023 calculation
ROE = Net income ÷ Total stockholders’ equity
= $107,475K ÷ $850,492K
= 12.64%
MGP Ingredients, Inc.'s return on equity (ROE) has exhibited a downward trend over the past five years. The ROE decreased from 16.68% in 2019 to 12.51% in 2023. This decline indicates that the company's ability to generate profit from shareholders' equity has weakened over the years. While the ROE is still positive, the decreasing trend suggests that the company may be facing challenges in efficiently utilizing its equity to generate returns for its shareholders. Further analysis is needed to understand the factors driving this downward trajectory and to identify potential strategies for improvement in ROE.