Textron Inc (TXT)
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 | -1,516,000 | -1,308,000 | -1,270,000 | -1,315,000 | -1,821,000 | -1,830,000 | -1,930,000 | -2,066,000 | -2,114,000 | 4,934,000 | 7,977,000 | 10,765,000 | 13,908,000 | 11,964,000 | 9,259,000 | 6,872,000 | 4,042,000 | 3,681,000 | 4,301,000 | 4,554,000 |
| Total assets | US$ in thousands | 16,856,000 | 16,492,000 | 16,485,000 | 16,393,000 | 16,293,000 | 15,956,000 | 15,879,000 | 15,911,000 | 15,827,000 | 15,269,000 | 15,379,000 | 15,414,000 | 15,443,000 | 15,861,000 | 15,471,000 | 15,946,000 | 15,018,000 | 15,062,000 | 14,796,000 | 14,480,000 |
| Operating ROA | -8.99% | -7.93% | -7.70% | -8.02% | -11.18% | -11.47% | -12.15% | -12.98% | -13.36% | 32.31% | 51.87% | 69.84% | 90.06% | 75.43% | 59.85% | 43.10% | 26.91% | 24.44% | 29.07% | 31.45% |
December 31, 2023 calculation
Operating ROA = Operating income (ttm) ÷ Total assets
= $-1,516,000K ÷ $16,856,000K
= -8.99%
The operating return on assets (ROA) for Textron Inc has shown a significant fluctuation over the past several quarters. The negative trend in operating ROA since the second quarter of 2021 indicates a declining ability of the company to generate profits from its assets through its core operations.
The operating ROA decreased from 31.45% in the first quarter of 2019 to -8.99% by the end of December 2023. This deterioration in performance suggests challenges in effectively utilizing the company's assets to generate operating income.
The sharp decline in operating ROA from 90.06% in the first quarter of 2021 to -12.98% in the first quarter of 2022 signals a significant drop in profitability relative to the assets employed. Subsequent improvements in the following quarters were not sustained, with the operating ROA continuing to fluctuate at negative levels in recent periods.
The negative values for operating ROA indicate that Textron Inc's core business operations are not yielding sufficient returns relative to the assets employed. This trend may raise concerns about the company's operational efficiency, profitability, and overall financial health. Further analysis of the company's operational performance and asset utilization strategies would be necessary to address these ongoing challenges.
Peer comparison
Dec 31, 2023