Waters Corporation (WAT)

Return on equity (ROE)

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	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
Net income (ttm)	US$ in thousands	637,834	622,641	595,690	603,507	642,234	653,091	674,537	688,847	707,755	696,932	702,119	704,547	692,843	694,915	660,499	616,136	521,571	503,929	515,293	536,774
Total stockholders’ equity	US$ in thousands	1,828,510	1,603,100	1,411,970	1,256,520	1,150,340	905,522	771,229	599,823	504,488	385,236	392,124	374,937	367,554	295,222	268,273	230,962	232,144	-41,581	-191,742	-337,999
ROE		34.88%	38.84%	42.19%	48.03%	55.83%	72.12%	87.46%	114.84%	140.29%	180.91%	179.06%	187.91%	188.50%	235.39%	246.20%	266.77%	224.68%	—	—	—

December 31, 2024 calculation

ROE = Net income (ttm) ÷ Total stockholders’ equity
= $637,834K ÷ $1,828,510K
= 34.88%

Waters Corporation's return on equity (ROE) has experienced significant fluctuations over the past few years. The ROE was not available for the first three quarters of 2020, but it stood at an impressive 224.68% for the fiscal year-end December 31, 2020. This could indicate that the company was able to generate a high level of profits relative to the shareholders' equity during that period.

Subsequently, the ROE continued to rise reaching a peak of 266.77% by March 31, 2021, reflecting strong profitability and efficient use of shareholders' funds. However, the ROE started to decline gradually from that point onwards, falling to 34.88% by the end of December 31, 2024.

The decreasing trend in ROE suggests that Waters Corporation may be facing challenges in maintaining its profit levels relative to the shareholders' equity. It could be due to various factors such as declining profitability, inefficient use of assets, or increased equity base without corresponding growth in profits.

A declining ROE could also indicate that the company's financial performance is deteriorating, and shareholders may be concerned about the declining returns on their investment. Waters Corporation should closely monitor its profitability, asset utilization, and capital structure to address the declining trend in ROE and work towards improving shareholder returns.