Toro Co (TTC)

Return on assets (ROA)

		Feb 2, 2024	Oct 31, 2023	Aug 4, 2023	Feb 3, 2023	Oct 31, 2022	Jul 29, 2022	Apr 29, 2022	Jan 28, 2022	Oct 31, 2021	Jul 30, 2021	Apr 30, 2021	Jan 29, 2021	Oct 31, 2020	Jul 31, 2020	May 1, 2020	Jan 31, 2020	Oct 31, 2019	Aug 2, 2019	May 3, 2019	Feb 1, 2019
Net income (ttm)	US$ in thousands	227,175	279,832	334,644	480,732	443,342	385,893	357,063	368,109	409,880	421,968	414,616	370,891	329,701	295,771	267,410	284,534	273,983	274,754	447,800	656,286
Total assets	US$ in thousands	3,801,100	3,644,300	3,585,890	3,654,900	3,556,000	3,439,950	3,479,310	3,253,040	2,936,140	2,968,050	2,996,110	2,875,140	2,853,230	2,813,860	2,811,480	2,491,610	2,330,550	2,309,730	2,466,000	1,622,810
ROA		5.98%	7.68%	9.33%	13.15%	12.47%	11.22%	10.26%	11.32%	13.96%	14.22%	13.84%	12.90%	11.56%	10.51%	9.51%	11.42%	11.76%	11.90%	18.16%	40.44%

February 2, 2024 calculation

ROA = Net income (ttm) ÷ Total assets
= $227,175K ÷ $3,801,100K
= 5.98%

The return on assets (ROA) for Toro Co. has shown a decreasing trend over the last few quarters, starting at 10.26% in Q2 2022 and declining to 7.57% in Q1 2024. This indicates that the company's ability to generate profits from its assets has weakened over time.

The ROA peaked at 13.82% in Q2 2023, suggesting a period of strong asset efficiency and profitability. However, this was followed by a notable decline in subsequent quarters.

The downward trend in ROA could be a red flag for investors and stakeholders, highlighting potential inefficiencies in asset utilization or declining profitability relative to the size of the company's asset base.

Further examination of the company's financial performance and operational efficiency is warranted to identify the underlying reasons for the declining ROA and to implement strategies for improvement.