PriceSmart Inc (PSMT)

Operating return on assets (Operating ROA)

		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	Feb 29, 2020	Nov 30, 2019	Aug 31, 2019	May 31, 2019
Operating income (ttm)	US$ in thousands	197,020	187,202	184,516	191,344	182,054	176,576	167,066	160,562	162,849	159,506	158,020	154,537	142,455	136,285	122,468	125,454	123,484	121,211	115,167	110,396
Total assets	US$ in thousands	2,036,780	2,029,280	2,005,610	1,933,350	1,886,170	1,887,920	1,808,400	1,791,760	1,773,330	1,789,310	1,705,790	1,631,960	1,630,840	1,678,000	1,656,820	1,574,490	1,498,290	1,524,110	1,296,410	1,261,860
Operating ROA		9.67%	9.23%	9.20%	9.90%	9.65%	9.35%	9.24%	8.96%	9.18%	8.91%	9.26%	9.47%	8.74%	8.12%	7.39%	7.97%	8.24%	7.95%	8.88%	8.75%

February 29, 2024 calculation

Operating ROA = Operating income (ttm) ÷ Total assets
= $197,020K ÷ $2,036,780K
= 9.67%

The operating return on assets (ROA) for PriceSmart Inc has shown some stability in recent periods, ranging from 8.91% to 9.90%. The company's operating ROA has generally been above 9% which indicates that PriceSmart is effectively generating operating income from its assets.

The improvement in operating ROA from the low of 7.39% in May 2020 to the recent high of 9.90% in May 2023 suggests that the company has been able to optimize its asset utilization and increase operating efficiency over time. It is essential for investors and stakeholders to monitor this ratio to assess PriceSmart's ability to generate profits from its asset base.

However, the slight fluctuations seen in the ratio over the periods indicate that there may be some variability in the company's operating performance efficiency. Further analysis of the components contributing to operating ROA, such as operating income and total assets, can help in understanding the factors influencing the ratio's movement.