McCormick & Company Incorporated (MKC)
Return on equity (ROE)
| Nov 30, 2024 | Aug 31, 2024 | May 31, 2024 | Feb 29, 2024 | Nov 30, 2023 | Aug 31, 2023 | May 31, 2023 | Feb 28, 2023 | Nov 30, 2022 | Aug 31, 2022 | May 31, 2022 | Feb 28, 2022 | Nov 30, 2021 | Aug 31, 2021 | May 31, 2021 | Feb 28, 2021 | Nov 30, 2020 | Aug 31, 2020 | May 31, 2020 | Feb 29, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Net income (ttm) | US$ in thousands | 788,500 | 792,600 | 739,600 | 707,500 | 680,600 | 647,000 | 699,800 | 666,200 | 682,000 | 693,700 | 683,200 | 748,400 | 755,300 | 758,600 | 752,300 | 764,500 | 747,400 | 760,100 | 745,900 | 699,400 |
| Total stockholders’ equity | US$ in thousands | 5,291,000 | 5,421,500 | 5,327,400 | 5,232,500 | 5,060,700 | 5,049,300 | 4,937,000 | 4,870,100 | 4,680,500 | 4,589,300 | 4,598,200 | 4,597,700 | 4,411,000 | 4,386,500 | 4,325,300 | 4,149,500 | 3,926,100 | 3,932,700 | 3,649,900 | 3,561,900 |
| ROE | 14.90% | 14.62% | 13.88% | 13.52% | 13.45% | 12.81% | 14.17% | 13.68% | 14.57% | 15.12% | 14.86% | 16.28% | 17.12% | 17.29% | 17.39% | 18.42% | 19.04% | 19.33% | 20.44% | 19.64% |
November 30, 2024 calculation
ROE = Net income (ttm) ÷ Total stockholders’ equity
= $788,500K ÷ $5,291,000K
= 14.90%
The return on equity (ROE) for McCormick & Company Incorporated has shown a gradual decline over the period from February 29, 2020, to November 30, 2024. The ROE decreased from 19.64% in February 2020 to 14.90% in November 2024. This downward trend indicates that the company's profitability relative to shareholders' equity has been diminishing over time.
The lower ROE may suggest that McCormick & Company is not effectively utilizing its shareholders' investments to generate profits. It could be a result of various factors such as declining profitability, increasing debt levels, or inefficient use of assets. Investors and stakeholders may view a decreasing ROE negatively as it reflects a potentially weakening financial performance and less attractive investment returns.
It would be prudent for McCormick & Company's management to closely analyze the reasons behind the declining ROE and take strategic actions to improve profitability, enhance operational efficiency, or optimize capital structure to reverse this trend and enhance shareholder value in the future.