Solventum Corp. (SOLV)

Return on equity (ROE)

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022
Net income (ttm)	US$ in thousands	478,000	521,000	684,000	916,000	972,000	1,206,000	1,256,000	1,285,500	1,343,000
Total stockholders’ equity	US$ in thousands	2,959,000	3,192,000	2,867,000	3,851,000	3,409,000	3,250,000	3,964,000	11,742,000	11,742,000
ROE		16.15%	16.32%	23.86%	23.79%	28.51%	37.11%	31.69%	10.95%	11.44%

December 31, 2024 calculation

ROE = Net income (ttm) ÷ Total stockholders’ equity
= $478,000K ÷ $2,959,000K
= 16.15%

The return on equity (ROE) of Solventum Corp. has shown some fluctuations over the period from December 31, 2022, to December 31, 2024. ROE is a key financial ratio that measures a company's profitability by evaluating how effectively it is utilizing shareholder equity to generate profits.

Initially, in December 2022, Solventum Corp. had an ROE of 11.44%, indicating that the company was generating a profit of 11.44% on the shareholder equity invested. The ROE slightly decreased to 10.95% in March 2023, but then saw a significant improvement in June 2023, reaching 31.69%. This sharp increase suggests that the company significantly improved its profitability relative to equity during that period.

Throughout the following quarters, Solventum Corp. maintained a relatively high ROE, with figures above 20% in most quarters. However, there was a slight decline in the ROE in the latter part of 2024, dropping to 16.15% in December 2024.

Overall, the ROE trend for Solventum Corp. indicates that the company was effectively utilizing its shareholder equity to generate profits, with periods of significant improvement in profitability. However, the slight decline towards the end of 2024 may warrant further analysis to understand the factors influencing the company's return on equity.