Toll Brothers Inc (TOL)

Return on assets (ROA)

		Oct 31, 2023	Oct 31, 2022	Oct 31, 2021	Oct 31, 2020	Oct 31, 2019
Net income	US$ in thousands	1,372,070	1,286,500	833,627	446,624	590,007
Total assets	US$ in thousands	12,527,000	12,288,700	11,537,800	11,065,700	10,828,100
ROA		10.95%	10.47%	7.23%	4.04%	5.45%

October 31, 2023 calculation

ROA = Net income ÷ Total assets
= $1,372,070K ÷ $12,527,000K
= 10.95%

Toll Brothers Inc.'s return on assets (ROA) is an important financial metric that indicates how efficiently the company is utilizing its assets to generate profits. ROA is calculated by dividing the company's net income by its average total assets. A higher ROA signifies better efficiency in generating profits from assets.

Looking at the data provided, Toll Brothers Inc.'s ROA has shown an upward trend over the past five years. In 2019, the ROA stood at 5.45%, and it increased to 7.23% in 2021, marking a significant improvement. This indicates that the company became more efficient in generating profits from its assets during this period.

The most recent ROA figure for Oct 31, 2023, is 10.95%, which reflects a continued positive trend. This suggests that the company has been successful in further improving its asset utilization and profitability over the past year.

The consistent increase in ROA indicates that Toll Brothers Inc. has been effectively managing its assets to generate profits, which is a positive sign for investors and stakeholders. It shows that the company's operational efficiency and profitability have improved over the years.

Overall, Toll Brothers Inc.'s ROA trend reflects the company's ability to generate more profits from its assets, signaling effective management and operational performance. However, it is important to consider other factors such as industry benchmarks and economic conditions when evaluating the significance of the ROA trend.