nVent Electric PLC (NVT)
Return on assets (ROA)
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Net income | US$ in thousands | 331,800 | 567,100 | 399,800 | 272,900 | -47,200 |
| Total assets | US$ in thousands | 6,734,900 | 6,161,700 | 4,902,200 | 4,674,200 | 4,366,100 |
| ROA | 4.93% | 9.20% | 8.16% | 5.84% | -1.08% |
December 31, 2024 calculation
ROA = Net income ÷ Total assets
= $331,800K ÷ $6,734,900K
= 4.93%
nVent Electric PLC's Return on Assets (ROA) is a key financial ratio that indicates the company's efficiency in generating profit from its assets. Looking at the trend over the past five years, we observe fluctuations in the ROA:
1. In 2020, the ROA was negative at -1.08%, suggesting that the company was not effectively utilizing its assets to generate profit, potentially facing operational challenges or inefficiencies.
2. By the end of 2021, there was a significant improvement, with the ROA increasing to 5.84%, signaling enhanced profitability relative to the previous year.
3. The trend continued to improve through 2022 and 2023, with ROA reaching 8.16% and 9.20%, respectively, indicating that the company was utilizing its assets more efficiently to generate profit.
4. However, in 2024, there was a slight decline in ROA to 4.93%, which may suggest a dip in profitability relative to the previous year.
Overall, the increasing trend in ROA from 2020 to 2023 reflects improvements in nVent Electric PLC's asset utilization and profitability. However, the slight decrease in 2024 warrants further analysis to understand the factors behind this change and evaluate the company's overall financial performance and asset management strategies.
Peer comparison
Dec 31, 2024