Tesla Inc (TSLA)
Return on equity (ROE)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Net income | US$ in thousands | 14,997,000 | 12,556,000 | 5,519,000 | 721,000 | -862,000 |
| Total stockholders’ equity | US$ in thousands | 62,634,000 | 44,704,000 | 30,189,000 | 22,225,000 | 6,618,000 |
| ROE | 23.94% | 28.09% | 18.28% | 3.24% | -13.03% |
December 31, 2023 calculation
ROE = Net income ÷ Total stockholders’ equity
= $14,997,000K ÷ $62,634,000K
= 23.94%
Tesla Inc's return on equity (ROE) has shown varying trends over the past five years. In 2023, the ROE of 23.95% indicates a solid performance, although it has declined from the previous year's 28.15%. This suggests that the company's profitability in relation to shareholders' equity has slightly weakened. However, compared to 2021 and 2020, the ROE has shown improvement, reflecting better utilization of equity to generate profits.
The substantial increase from the negative ROE of -13.03% in 2019 to the positive figures in subsequent years demonstrates a commendable turnaround. It highlights Tesla's efforts in efficiently employing shareholders' funds to generate returns. Despite the decrease in 2023, the overall trend signals a positive trajectory and improved financial performance.
It is essential for stakeholders to closely monitor the ROE trend to assess the company's ability to generate profits from the shareholders' investments. Further analysis of the key drivers behind the changes in ROE, such as profitability, asset utilization, and financial leverage, would provide deeper insights into Tesla's financial performance.
Peer comparison
Dec 31, 2023