Verizon Communications Inc (VZ)
Return on assets (ROA)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Net income | US$ in thousands | 11,614,000 | 21,256,000 | 22,065,000 | 17,801,000 | 19,265,000 |
| Total assets | US$ in thousands | 380,255,000 | 379,680,000 | 366,596,000 | 316,481,000 | 291,727,000 |
| ROA | 3.05% | 5.60% | 6.02% | 5.62% | 6.60% |
December 31, 2023 calculation
ROA = Net income ÷ Total assets
= $11,614,000K ÷ $380,255,000K
= 3.05%
Verizon Communications Inc's return on assets (ROA) has exhibited a declining trend over the five-year period from 2019 to 2023. The ROA decreased from 6.60% in 2019 to 3.05% in 2023. This downward trajectory indicates a decrease in the company's ability to generate profits relative to its total assets.
A lower ROA suggests that Verizon is less efficient in utilizing its assets to generate earnings. This could be a result of various factors such as increased costs, declining revenues, or inefficient asset management. Investors and stakeholders may view a declining ROA as a concerning indicator of declining profitability and operational efficiency within the company.
It would be important for Verizon to closely examine its asset utilization and profitability strategies to reverse this trend and improve its ROA in order to enhance overall financial performance and investor confidence.
Peer comparison
Dec 31, 2023