Neogen Corporation (NEOG)
Operating return on assets (Operating ROA)
| May 31, 2024 | May 31, 2023 | May 31, 2022 | May 31, 2021 | May 31, 2020 | ||
|---|---|---|---|---|---|---|
| Operating income | US$ in thousands | 58,663 | 37,515 | 34,924 | 53,128 | 49,127 |
| Total assets | US$ in thousands | 4,548,830 | 4,554,430 | 992,929 | 920,192 | 797,182 |
| Operating ROA | 1.29% | 0.82% | 3.52% | 5.77% | 6.16% |
May 31, 2024 calculation
Operating ROA = Operating income ÷ Total assets
= $58,663K ÷ $4,548,830K
= 1.29%
Neogen Corporation's operating return on assets (operating ROA) has exhibited a decline over the past five years. In May 2020, the operating ROA stood at 6.16%, indicating that the company generated a return of 6.16% from its operating activities in relation to its total assets. However, this ratio decreased to 5.77% by May 2021, signifying a slight dip in operating efficiency.
Subsequently, there was a more noticeable decline in operating ROA as it dropped to 3.52% by May 2022, showing a significant decrease in the company's ability to generate returns from its assets through its operations. This downward trend continued in the following years, with the operating ROA plummeting to 0.82% by May 2023 and slightly recovering to 1.29% by May 2024.
The decreasing trend in Neogen Corporation's operating ROA suggests that the company may be facing challenges in optimizing its asset utilization and operational efficiency. It is crucial for management to assess and address the factors contributing to this decline to improve the company's profitability and overall financial performance in the future.
Peer comparison
May 31, 2024