Otis Worldwide Corp (OTIS)
Operating return on assets (Operating ROA)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|
| Operating income | US$ in thousands | 2,186,000 | 2,033,000 | 2,108,000 | 1,639,000 |
| Total assets | US$ in thousands | 10,117,000 | 9,819,000 | 12,279,000 | 10,710,000 |
| Operating ROA | 21.61% | 20.70% | 17.17% | 15.30% |
December 31, 2023 calculation
Operating ROA = Operating income ÷ Total assets
= $2,186,000K ÷ $10,117,000K
= 21.61%
Operating return on assets (ROA) measures the efficiency with which Otis Worldwide Corp generates operating income from its assets. The trend of operating ROA over the past five years indicates a generally positive performance.
In 2023, the operating ROA improved to 21.40%, showing an increase from the prior year's 20.44%. This suggests that Otis Worldwide Corp became more efficient in generating operating income relative to its assets.
Comparing to previous years, the operating ROA has shown an upward trend from 2019 to 2020, then a slight decrease in 2021, followed by increases in 2022 and 2023. Overall, the company has been successful in enhancing its operating efficiency over this period.
The consistent improvement in operating ROA reflects effective management of assets to generate operating profits, which is a positive indicator of Otis Worldwide Corp's operational performance and potential for future growth. However, it's essential to closely monitor this ratio in the future to ensure sustained efficiency and profitability.
Peer comparison
Dec 31, 2023