Neogen Corporation (NEOG)

Return on equity (ROE)

Feb 28, 2025 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
Net income (ttm) US$ in thousands -485,263 -476,328 -23,533 -9,421 1,566 11,778 -26,576 -22,870 -13,483 -16,230 36,439 48,307 49,108 57,042 62,099 60,882 61,469 60,292 60,683 59,475
Total stockholders’ equity US$ in thousands 2,660,350 2,669,070 3,135,190 3,144,140 3,146,170 3,147,570 3,146,180 3,134,220 3,125,560 3,106,260 883,798 887,374 875,544 865,476 855,363 840,377 807,683 777,395 751,546 725,177
ROE -18.24% -17.85% -0.75% -0.30% 0.05% 0.37% -0.84% -0.73% -0.43% -0.52% 4.12% 5.44% 5.61% 6.59% 7.26% 7.24% 7.61% 7.76% 8.07% 8.20%

February 28, 2025 calculation

ROE = Net income (ttm) ÷ Total stockholders’ equity
= $-485,263K ÷ $2,660,350K
= -18.24%

Neogen Corporation's return on equity (ROE) has shown a declining trend over the past several years, dropping from a peak of 8.20% as of May 31, 2020, to a low of -18.24% as of February 28, 2025. This downward trajectory indicates that the company's ability to generate profits from shareholders' equity has deteriorated significantly.

The declining ROE may suggest that Neogen Corporation is facing challenges in effectively utilizing its equity capital to generate returns for its shareholders. A negative ROE, especially in the later periods, indicates that the company's net income is insufficient to cover its equity base, which could be a concern for investors and stakeholders.

Investors and analysts may need to further investigate the reasons behind the deteriorating ROE, such as declining profitability, increasing debt levels, or inefficient asset utilization. It is essential for the company to address these issues to improve its profitability and restore confidence among investors.