Sally Beauty Holdings Inc (SBH)
Return on equity (ROE)
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | ||
|---|---|---|---|---|---|---|
| Net income | US$ in thousands | 153,414 | 184,600 | 183,553 | 239,858 | 184,600 |
| Total stockholders’ equity | US$ in thousands | 628,535 | 508,748 | 293,636 | 280,741 | 15,443 |
| ROE | 24.41% | 36.29% | 62.51% | 85.44% | 1,195.36% |
September 30, 2024 calculation
ROE = Net income ÷ Total stockholders’ equity
= $153,414K ÷ $628,535K
= 24.41%
Sally Beauty Holdings Inc's return on equity (ROE) has shown significant fluctuations over the past five years. In fiscal year 2020, the ROE was exceptionally high at 1,195.36%, which may indicate abnormal circumstances such as one-time gains or losses, accounting adjustments, or other anomalies. This extreme figure should be investigated further to understand its underlying causes.
Subsequently, the ROE decreased sharply in fiscal year 2021 to 85.44%, which, while still a healthy return, represented a substantial drop from the prior year. It is essential to determine the reasons for this decrease and assess whether it is a temporary decline or a more concerning trend.
In fiscal year 2022, the ROE continued to decline to 62.51%, suggesting that the company's profitability and efficiency in generating returns for shareholders may have been impacted. Further analysis is required to identify the factors contributing to this decrease and assess the company's strategic initiatives.
In fiscal year 2023, the ROE rebounded to 36.29%, showing signs of improvement compared to the previous year. However, it is worth noting that this figure is still lower than the ROE levels seen in earlier years.
Most recently, in fiscal year 2024, the ROE further declined to 24.41%, indicating a trend of decreasing returns relative to shareholders' equity. This downward trajectory raises concerns about the company's ability to maintain or enhance its profitability and generate value for shareholders.
Overall, the fluctuating ROE of Sally Beauty Holdings Inc over the past five years underscores the importance of closely monitoring financial performance and conducting in-depth analysis to identify key drivers affecting the company's return on equity.
Peer comparison
Sep 30, 2024