Tyson Foods Inc (TSN)
Operating return on assets (Operating ROA)
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|
| Operating income | US$ in thousands | -395,000 | 4,410,000 | 4,396,000 | 3,008,000 | 2,770,000 |
| Total assets | US$ in thousands | 36,251,000 | 36,821,000 | 36,309,000 | 34,456,000 | 32,918,000 |
| Operating ROA | -1.09% | 11.98% | 12.11% | 8.73% | 8.41% |
September 30, 2023 calculation
Operating ROA = Operating income ÷ Total assets
= $-395,000K ÷ $36,251,000K
= -1.09%
Certainly! Operating return on assets (operating ROA) is a measure of a company's operating profitability relative to its total assets. It indicates how efficiently the company is utilizing its assets to generate operating income.
Tyson Foods, Inc.'s operating ROA has fluctuated over the past five years, as shown in the table. In 2023, the operating ROA decreased to 1.06% from the previous year's 11.98%. This sharp decline could indicate a decrease in operating income relative to the company's assets, which may be a cause for concern.
In 2022, Tyson Foods, Inc. had a relatively high operating ROA of 11.98%, signifying a strong operating profitability relative to its asset base. This could be attributed to efficient asset utilization and strong operating income generation during that period. The following year, in 2021, the operating ROA remained high at 12.11%, indicating sustained operational efficiency and profitability.
Looking back to 2020, the operating ROA was 8.73%, indicating a slight decrease from the previous year but still demonstrating effective asset utilization to generate operating income. In 2019, the operating ROA was 8.54%, consistent with the prior year's performance.
The fluctuation in operating ROA over the years may warrant an investigation into the factors impacting Tyson Foods, Inc.'s operating profitability and asset efficiency. It's essential to assess changes in operating income, total assets, and the company's operational strategies to determine the underlying reasons for the fluctuations in operating ROA.
Overall, the analysis of Tyson Foods, Inc.'s operating ROA suggests a mixed performance over the past five years, with significant fluctuations that merit further investigation and attention to maintain and improve operational efficiency and profitability.
Peer comparison
Sep 30, 2023