Neogen Corporation (NEOG)

Return on equity (ROE)

May 31, 2025 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
Net income (ttm) US$ in thousands -1,092,044 -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
Total stockholders’ equity US$ in thousands 2,071,250 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
ROE -52.72% -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%

May 31, 2025 calculation

ROE = Net income (ttm) ÷ Total stockholders’ equity
= $-1,092,044K ÷ $2,071,250K
= -52.72%

The analysis of Neogen Corporation's return on equity (ROE) over the specified period reveals notable fluctuations and a significant trend of deterioration. Initially, as of August 31, 2020, the company's ROE stood at 8.07%, indicating a modest level of profitability and efficient utilization of shareholders' equity during that period. Over the subsequent quarters, the ROE experienced a gradual decline, reaching 7.76% by November 30, 2020, and further decreasing slightly to 7.61% by February 28, 2021. A continued downward trajectory persisted through May 31, 2021, with ROE at 7.24%, and the figure stabilized marginally at 7.26% as of August 31, 2021.

From late 2021 onward, the ROE demonstrated a declining pattern, with the figure dropping to 6.59% by November 30, 2021, and further declining to 5.61% by February 28, 2022. The trend persisted into mid-2022, with ROE diminishing to approximately 5.44% by May 31, 2022; by August 31, 2022, it had decreased further to 4.12%. The decline accelerated into late 2022 and early 2023, with the ROE crossing below zero for the first time, reaching -0.52% on November 30, 2022, and marginally improving to -0.43% by February 28, 2023. This negative ROE persisted into May 2023 and the subsequent quarters, indicating that the company was generating losses attributable to shareholders during this period.

The negative trend continued into August 2023 and November 2023, although a slight positive recovery occurred, with ROE at 0.37% on November 30, 2023, and then dropping marginally to 0.05% on February 29, 2024. However, this modest improvement did not sustain, and the ROE again declined to -0.30% by May 31, 2024, and further into negative territory at -0.75% by August 2024. The most recent data points depict a sharp deterioration, with ROE plummeting to -17.85% on November 30, 2024, and reaching -18.24% by February 28, 2025. The trajectory projects a continued decline, with the latest available figure indicating a drastic negative ROE at -52.72% as of May 31, 2025.

Overall, the data signals a prolonged period of declining profitability relative to shareholders' equity, culminating in severe negative ROE figures in recent periods. This suggests challenges in generating adequate profits from shareholders' investments, potentially reflecting operational difficulties, worsening financial performance, or other structural issues affecting the company's ability to produce positive returns on equity.