Callaway Golf Company (MODG)
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 | -1,257,200 | 237,700 | 256,800 | 204,700 | -105,500 |
| Total assets | US$ in thousands | 7,636,100 | 9,120,600 | 8,590,400 | 7,747,800 | 1,980,600 |
| Operating ROA | -16.46% | 2.61% | 2.99% | 2.64% | -5.33% |
December 31, 2024 calculation
Operating ROA = Operating income ÷ Total assets
= $-1,257,200K ÷ $7,636,100K
= -16.46%
Operating ROA is a key financial ratio that indicates how effectively a company is generating profits from its assets used in operations. Looking at the data for Callaway Golf Company over the years, we observe fluctuations in the operating ROA.
In 2020, the operating ROA was at a negative 5.33%, suggesting that the company was facing challenges in generating profits from its operating assets. However, in the subsequent years, there was a significant improvement. By the end of 2021, the operating ROA increased to 2.64%, indicating a turnaround in the company's operational efficiency. This positive trend continued into 2022 and 2023, with operating ROA reaching 2.99% and 2.61% respectively.
It is noteworthy that in 2024, the operating ROA dropped drastically to -16.46%, indicating a sharp decline in the company's profitability relative to its operating assets. This could be a cause for concern as it signifies that the company is not effectively utilizing its operational resources to generate profits.
Overall, while there have been improvements in operating ROA over the years, the significant decline in 2024 is a point of scrutiny for Callaway Golf Company's operational performance and efficiency in utilizing its assets to generate returns.
Peer comparison
Dec 31, 2024