RXO Inc. (RXO)
Return on equity (ROE)
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Net income | US$ in thousands | -285 | 4,000 | 92,000 | 150,000 | 43,000 |
| Total stockholders’ equity | US$ in thousands | 1,612,000 | 594,000 | 589,000 | 1,070,000 | 1,068,000 |
| ROE | -0.02% | 0.67% | 15.62% | 14.02% | 4.03% |
December 31, 2024 calculation
ROE = Net income ÷ Total stockholders’ equity
= $-285K ÷ $1,612,000K
= -0.02%
Using the provided data, the return on equity (ROE) of RXO Inc. has shown fluctuating trends over the past five years.
In December 31, 2020, the ROE was at a relatively low level of 4.03%, indicating that the company was not efficiently utilizing its equity to generate profits for its shareholders. However, there was a significant improvement in the ROE by December 31, 2021, which surged to 14.02%, suggesting an increase in profitability and more effective use of shareholder equity.
The positive trend continued into December 31, 2022, with the ROE reaching 15.62%, demonstrating further enhancement in the company's ability to generate profit from its equity base. However, there was a substantial decline in ROE by December 31, 2023, dropping to a mere 0.67%, indicating a decline in profitability and potentially inefficiencies in capital utilization.
By December 31, 2024, the ROE turned negative at -0.02%, implying that the company was experiencing a loss relative to its equity, which could be concerning for shareholders and stakeholders.
In conclusion, the ROE of RXO Inc. has shown significant fluctuations over the past five years, reflecting varying levels of profitability and efficiency in utilizing shareholder equity. Further analysis of the company's financial performance and efficiency ratios may be necessary to better understand the factors driving these fluctuations.
Peer comparison
Dec 31, 2024