Simulations Plus Inc (SLP)

Operating return on assets (Operating ROA)

		Aug 31, 2024	May 31, 2024	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
Operating income (ttm)	US$ in thousands	6,131	6,998	9,215	8,807	8,725	9,703	10,552	11,998	14,911	14,391	13,987	11,993	11,253	13,282	12,597	11,937	11,604	11,350	11,375	11,279
Total assets	US$ in thousands	196,639	192,691	193,973	185,778	186,101	179,134	173,201	190,461	188,382	186,223	185,044	180,994	179,978	179,083	175,769	170,470	168,422	35,885	49,200	47,763
Operating ROA		3.12%	3.63%	4.75%	4.74%	4.69%	5.42%	6.09%	6.30%	7.92%	7.73%	7.56%	6.63%	6.25%	7.42%	7.17%	7.00%	6.89%	31.63%	23.12%	23.61%

August 31, 2024 calculation

Operating ROA = Operating income (ttm) ÷ Total assets
= $6,131K ÷ $196,639K
= 3.12%

Simulations Plus Inc's operating return on assets (ROA) has shown variability over the analyzed periods. The operating ROA ranged from a low of 3.12% in August 2024 to a high of 31.63% in August 2020. This indicates fluctuations in the company's ability to generate operating profits from its assets.

Overall, the trend in operating ROA appears to have decreased in recent periods, as seen from the downward trend from 31.63% in August 2020 to 3.12% in August 2024. This decreasing trend suggests potential challenges in maintaining profitability relative to assets employed in operations.

Despite the fluctuations and recent decline, Simulations Plus Inc's operating ROA has generally been above 5% in most periods, indicating a reasonable level of operational efficiency and profitability. However, the significant drop in the most recent period raises concerns about the company's current performance in effectively utilizing its assets to generate operating income.

It is advisable for stakeholders to further investigate the factors contributing to the decline in operating ROA and assess the company's operational strategies to address any potential inefficiencies impacting profitability.