Raytheon Technologies Corp (RTX)
Operating return on assets (Operating ROA)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Operating income | US$ in thousands | 3,561,000 | 5,504,000 | 4,958,000 | -1,889,000 | 4,914,000 |
| Total assets | US$ in thousands | 161,869,000 | 158,864,000 | 161,404,000 | 162,153,000 | 139,615,000 |
| Operating ROA | 2.20% | 3.46% | 3.07% | -1.16% | 3.52% |
December 31, 2023 calculation
Operating ROA = Operating income ÷ Total assets
= $3,561,000K ÷ $161,869,000K
= 2.20%
RTX Corp's operating return on assets (operating ROA) has fluctuated over the past five years. In 2023, the operating ROA decreased to 2.15% from 3.33% in 2022. This decline indicates that the company's ability to generate operating profits from its assets has weakened compared to the previous year. However, the operating ROA in 2023 is still higher than the levels seen in 2021 and 2020, which were 2.81% and 0.25% respectively.
In contrast, RTX Corp's operating ROA was significantly higher in 2019 at 6.04%, reflecting a strong performance in leveraging its assets to generate operating income. The decrease in operating ROA from 2019 to 2023 suggests a potential decline in the company's operational efficiency or profitability relative to its asset base. Management should closely evaluate the factors contributing to this trend and consider implementing strategies to improve the operating ROA in future periods.
Peer comparison
Dec 31, 2023