United Parcel Service Inc (UPS)
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 | 9,141,000 | 9,859,000 | 11,629,000 | 12,384,000 | 13,094,000 | 13,790,000 | 13,573,000 | 13,296,000 | 12,810,000 | 10,956,000 | 10,423,000 | 9,377,000 | 7,684,000 | 7,780,000 | 7,545,000 | 7,476,000 | 7,798,000 | 7,669,000 | 7,268,000 | 6,898,000 |
| Total assets | US$ in thousands | 70,857,000 | 70,281,000 | 70,347,000 | 72,189,000 | 71,124,000 | 69,544,000 | 70,089,000 | 70,113,000 | 69,405,000 | 65,739,000 | 64,869,000 | 63,312,000 | 62,408,000 | 62,406,000 | 62,057,000 | 60,895,000 | 57,857,000 | 53,282,000 | 52,787,000 | 52,061,000 |
| Operating ROA | 12.90% | 14.03% | 16.53% | 17.15% | 18.41% | 19.83% | 19.37% | 18.96% | 18.46% | 16.67% | 16.07% | 14.81% | 12.31% | 12.47% | 12.16% | 12.28% | 13.48% | 14.39% | 13.77% | 13.25% |
December 31, 2023 calculation
Operating ROA = Operating income (ttm) ÷ Total assets
= $9,141,000K ÷ $70,857,000K
= 12.90%
Operating Return on Assets (Operating ROA) is a key financial ratio that indicates how efficiently a company generates profit from its assets solely from its core operations. It is calculated by dividing operating income by average total assets.
Upon analyzing the trend of United Parcel Service, Inc.'s Operating ROA over the past eight quarters, it is evident that the ratio has been fluctuating within a range. In Q1 2022, the Operating ROA was 18.96%, which decreased to 19.37% in Q2 2022 before declining further to 19.83% in Q3 2022. Subsequently, the ratio witnessed a declining pattern, reaching 18.41% in Q4 2022.
However, this downward trend reversed in the following quarters, showing a positive trajectory. In Q1 2023, the Operating ROA increased to 17.15%, followed by a further rise to 16.53% in Q2 2023 and 14.03% in Q3 2023. The ratio peaked at 12.90% in Q4 2023.
The fluctuation in United Parcel Service, Inc.'s Operating ROA suggests varying levels of operational efficiency and profitability over the quarters under review. It is essential for the company to closely monitor and manage its asset utilization and operating income generation to maintain a stable and favorable Operating ROA in the future.