SanDisk Corp (SNDK)
Operating return on assets (Operating ROA)
| Dec 31, 2015 | Dec 31, 2014 | Dec 31, 2013 | Dec 31, 2012 | Dec 31, 2011 | ||
|---|---|---|---|---|---|---|
| Operating income | US$ in thousands | 616,625 | 1,557,930 | 1,562,210 | 696,095 | 1,556,200 |
| Total assets | US$ in thousands | 9,230,760 | 10,290,000 | 10,488,700 | 10,339,100 | 10,174,600 |
| Operating ROA | 6.68% | 15.14% | 14.89% | 6.73% | 15.29% |
December 31, 2015 calculation
Operating ROA = Operating income ÷ Total assets
= $616,625K ÷ $9,230,760K
= 6.68%
Operating return on assets (ROA) measures the efficiency of SanDisk Corp in generating operating income from its assets. Looking at the trend over the years:
- In December 31, 2011, the operating ROA was 15.29%, indicating that for every dollar of assets, the company generated 15.29 cents in operating income.
- Subsequently, in December 31, 2012, there was a decrease in operating ROA to 6.73%, suggesting a decline in the operating efficiency of the company.
- However, in the following years, there was an improvement in operating ROA with percentages of 14.89% in December 31, 2013, 15.14% in December 31, 2014, and a slight decrease to 6.68% in December 31, 2015.
Overall, the varying trend in operating ROA indicates fluctuations in the company's ability to generate operating income from its assets, with the performance peaking in 2014 before dropping in 2015. Management should further analyze the causes behind these fluctuations to ensure sustainable profitability and efficiency in asset utilization.
Peer comparison
Dec 31, 2015