Marriot Vacations Worldwide (VAC)
Operating return on assets (Operating ROA)
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Operating income | US$ in thousands | 547,000 | 587,000 | 787,000 | 414,000 | 3,000 |
| Total assets | US$ in thousands | 9,808,000 | 9,680,000 | 9,639,000 | 9,613,000 | 8,898,000 |
| Operating ROA | 5.58% | 6.06% | 8.16% | 4.31% | 0.03% |
December 31, 2024 calculation
Operating ROA = Operating income ÷ Total assets
= $547,000K ÷ $9,808,000K
= 5.58%
The operating return on assets (Operating ROA) is a key financial ratio that measures a company's ability to generate operating profit from its assets. Analyzing Marriot Vacations Worldwide's Operating ROA data from 2020 to 2024, we observe a positive trend indicating improved operational efficiency and asset utilization.
In 2020, Marriot Vacations Worldwide had a relatively low Operating ROA of 0.03%, suggesting that the company was not effectively generating operating income from its assets. However, a significant improvement was seen in 2021 with the Operating ROA jumping to 4.31%, indicating a significant increase in operating profit relative to the assets employed.
The positive trend continued in 2022, with the Operating ROA reaching 8.16%, reflecting a substantial improvement in operational performance and asset utilization. However, in 2023, there was a slight decrease to 6.06% in Operating ROA, which may indicate a potential challenge in maintaining the high level of profitability from assets achieved in the previous year.
By the end of 2024, Marriot Vacations Worldwide's Operating ROA stood at 5.58%, still showing a favorable operating performance compared to 2020. This indicates that the company continues to efficiently generate operating income from its assets, albeit at a slightly lower rate than in 2022.
Overall, the upward trend in Marriot Vacations Worldwide's Operating ROA from 2020 to 2022 demonstrates improved operational efficiency and effective asset management. Although there was a slight dip in 2023, the company maintained a relatively strong Operating ROA in 2024, indicating a solid performance in utilizing its assets to generate operating profit.