Southern Company (SO)
Return on assets (ROA)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Net income | US$ in thousands | 3,976,000 | 3,535,000 | 2,408,000 | 3,134,000 | 4,739,000 |
| Total assets | US$ in thousands | 139,331,000 | 134,891,000 | 127,534,000 | 122,935,000 | 118,700,000 |
| ROA | 2.85% | 2.62% | 1.89% | 2.55% | 3.99% |
December 31, 2023 calculation
ROA = Net income ÷ Total assets
= $3,976,000K ÷ $139,331,000K
= 2.85%
The return on assets (ROA) for Southern Company has varied over the past five years, as evidenced by the following figures: 3.99% in 2019, 2.54% in 2020, 1.88% in 2021, 2.61% in 2022, and 2.85% in 2023. The ROA indicates the company's ability to generate profits relative to its total assets.
The trend in ROA shows a decrease from 2019 to 2021, followed by an increase in 2022 and 2023. The peak ROA of 3.99% in 2019 was followed by a decline in 2020, indicating a temporary decrease in profitability relative to assets. The subsequent fluctuation in 2021 and 2022 may suggest challenges or improvements in asset utilization and profitability.
The recent uptick in ROA in 2023 to 2.85% indicates a potential improvement in how efficiently Southern Company is using its assets to generate profit. It is important to evaluate the underlying factors contributing to these changes in ROA over the years to assess the company's operational performance and financial health accurately.
Peer comparison
Dec 31, 2023