Smart Global Holdings Inc (SGH)

Return on equity (ROE)

		Aug 25, 2023	Aug 26, 2022	Aug 27, 2021	Aug 28, 2020	Aug 30, 2019
Net income	US$ in thousands	-187,526	66,557	21,310	-1,143	51,332
Total stockholders’ equity	US$ in thousands	222,475	371,611	310,251	282,104	273,460
ROE		-84.29%	17.91%	6.87%	-0.41%	18.77%

August 25, 2023 calculation

ROE = Net income ÷ Total stockholders’ equity
= $-187,526K ÷ $222,475K
= -84.29%

Based on the data provided, SMART Global Holdings Inc's return on equity (ROE) has fluctuated significantly over the past five years. In 2023, the ROE was -84.29%, indicating a substantial decline compared to the previous year's ROE of 17.91%. This sharp decrease may raise concerns about the company's ability to generate profits from shareholders' equity.

In 2021, the ROE stood at 6.87%, showing moderate growth compared to 2020 when the ROE was -0.41%. However, this improvement was followed by a decline in 2019, when the ROE was 18.77%.

The negative ROE in 2023 may suggest that the company's net income was insufficient to cover shareholders' equity, potentially signaling a need for better capital management or operational efficiency.

Overall, the fluctuating ROE pattern observed in the past five years indicates that SMART Global Holdings Inc may be facing challenges in consistently generating substantial returns for its shareholders, emphasizing the importance of closely monitoring the company's financial performance and management of its equity.