TRI Pointe Homes Inc (TPH)

Operating return on assets (Operating ROA)

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Operating income (ttm)	US$ in thousands	2,938,716	1,973,726	1,340,366	723,831	746,516	673,875	654,990	629,137	605,040	563,495	492,926	418,151	366,506	363,274	343,925	300,010	253,859	240,657	240,230	289,638
Total assets	US$ in thousands	4,914,590	4,870,230	4,780,560	4,739,240	4,719,940	4,526,040	4,414,660	4,314,070	4,336,220	4,233,680	4,160,160	4,092,950	4,021,980	3,957,560	3,977,900	4,293,050	3,858,690	3,941,470	3,877,550	3,855,900
Operating ROA		59.80%	40.53%	28.04%	15.27%	15.82%	14.89%	14.84%	14.58%	13.95%	13.31%	11.85%	10.22%	9.11%	9.18%	8.65%	6.99%	6.58%	6.11%	6.20%	7.51%

December 31, 2023 calculation

Operating ROA = Operating income (ttm) ÷ Total assets
= $2,938,716K ÷ $4,914,590K
= 59.80%

Operating return on assets (operating ROA) measures a company's ability to generate operating profits from its assets. Tri Pointe Homes Inc.'s operating ROA has shown a decreasing trend over the past 8 quarters, starting at 16.33% in Q4 2022 and declining to 8.71% in Q4 2023. This indicates that the company may be becoming less efficient in utilizing its assets to generate operating income.

The average operating ROA over the 8 quarters is approximately 13.59%, with the highest value of 16.33% in Q4 2022 and the lowest value of 8.71% in Q4 2023. This suggests that Tri Pointe Homes Inc. experienced a peak in operating efficiency in Q4 2022, which has since declined.

Management should assess the reasons behind the decreasing trend in operating ROA and explore strategies to improve asset utilization efficiency. This could involve optimizing asset allocation, controlling operating expenses, or seeking opportunities to increase operating income. Monitoring and addressing the factors influencing operating ROA will be crucial for Tri Pointe Homes Inc. to enhance its operational performance and maintain profitability.