Watsco Inc (WSO)
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 | 781,775 | 771,424 | 831,578 | 628,528 | 401,034 |
| Total assets | US$ in thousands | 4,479,520 | 3,729,180 | 3,488,210 | 3,085,860 | 2,496,920 |
| Operating ROA | 17.45% | 20.69% | 23.84% | 20.37% | 16.06% |
December 31, 2024 calculation
Operating ROA = Operating income ÷ Total assets
= $781,775K ÷ $4,479,520K
= 17.45%
Watsco Inc's operating return on assets (operating ROA) has exhibited a positive trend over the last five years. The operating ROA increased from 16.06% as of December 31, 2020, to 20.37% as of December 31, 2021, signifying improved operational efficiency in utilizing its assets to generate earnings.
Further, there was a significant increase to 23.84% as of December 31, 2022, suggesting a more efficient utilization of assets to generate operating income. However, in the subsequent year, the operating ROA decreased slightly to 20.69% as of December 31, 2023. Finally, as of December 31, 2024, the operating ROA stood at 17.45%, indicating a slight decline in the efficiency of asset utilization compared to the previous year.
Overall, the operating ROA trend reflects fluctuations in the company's ability to generate operating income relative to its asset base, showcasing periods of improved efficiency and slight declines in asset utilization effectiveness over the five-year period.