Power Integrations Inc (POWI)
Return on assets (ROA)
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Net income | US$ in thousands | 32,234 | 55,735 | 170,851 | 164,413 | 71,176 |
| Total assets | US$ in thousands | 828,826 | 819,868 | 840,096 | 1,014,490 | 903,339 |
| ROA | 3.89% | 6.80% | 20.34% | 16.21% | 7.88% |
December 31, 2024 calculation
ROA = Net income ÷ Total assets
= $32,234K ÷ $828,826K
= 3.89%
Based on the provided data, Power Integrations Inc's return on assets (ROA) has shown significant fluctuations over the past five years.
In December 31, 2020, the ROA was at 7.88%, indicating the company generated 7.88 cents of profit for every dollar of assets it held. The ROA then increased to 16.21% by December 31, 2021, showcasing an improvement in the company's ability to generate earnings from its assets.
By December 31, 2022, the ROA experienced a notable increase to 20.34%, reflecting a further enhancement in the efficiency of Power Integrations' asset utilization. However, in December 31, 2023, the ROA declined to 6.80%, which may suggest a dip in the company's profitability relative to its assets.
Furthermore, the ROA dropped to 3.89% by December 31, 2024, indicating a significant decrease in the company's ability to generate earnings from its assets compared to the previous year. This decline could be attributed to various factors such as changes in the business environment, operational inefficiencies, or a decrease in revenue generation.
Overall, Power Integrations Inc's ROA trend suggests that the company achieved high levels of asset efficiency in 2022, but faced challenges in maintaining this level of performance in the subsequent years. It would be crucial for the company to analyze the reasons behind the fluctuations in its ROA and implement strategic measures to improve asset utilization in order to drive profitability in the future.
Peer comparison
Dec 31, 2024