Agrium (Agrium) ROA % : -5.88% (As of Sep. 2017)

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What is Agrium ROA %?

ROA % is calculated as Net Income divided by its average Total Assets over a certain period of time. Agrium's annualized Net Income for the quarter that ended in Sep. 2017 was $-1,012 Mil. Agrium's average Total Assets over the quarter that ended in Sep. 2017 was $17,217 Mil. Therefore, Agrium's annualized ROA % for the quarter that ended in Sep. 2017 was -5.88%.

The historical rank and industry rank for Agrium's ROA % or its related term are showing as below:

AGU's ROA % is not ranked ^*
in the Agriculture industry.
Industry Median: 2.37
* Ranked among companies with meaningful ROA % only.

Agrium ROA % Historical Data

The historical data trend for Agrium's ROA % can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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Agrium ROA % Chart

Agrium Annual Data

Trend

Dec07

Dec08

Dec09

Dec10

Dec11

Dec12

Dec13

Dec14

Dec15

Dec16

ROA %

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10.32

6.68

4.32

5.90

3.55

Agrium Quarterly Data
	Dec12	Mar13	Jun13	Sep13	Dec13	Mar14	Jun14	Sep14	Dec14	Mar15	Jun15	Sep15	Dec15	Mar16	Jun16	Sep16	Dec16	Mar17	Jun17	Sep17
ROA %	Get a 7-Day Free Trial															-0.97	1.60	-0.25	12.62	-5.88

Competitive Comparison of Agrium's ROA %

For the Agricultural Inputs subindustry, Agrium's ROA %, along with its competitors' market caps and ROA % data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Agrium's ROA % Distribution in the Agriculture Industry

For the Agriculture industry and Basic Materials sector, Agrium's ROA % distribution charts can be found below:

* The bar in red indicates where Agrium's ROA % falls into.

Agrium ROA % Calculation

Agrium's annualized ROA % for the fiscal year that ended in Dec. 2016 is calculated as:

ROA %	=	Net Income (A: Dec. 2016 )	/	( (Total Assets (A: Dec. 2015 )	+	Total Assets (A: Dec. 2016 ))	/ count )
	=	592	/	( (16377	+	16963)	/ 2 )
	=	592	/	16670
	=	3.55 %

Agrium's annualized ROA % for the quarter that ended in Sep. 2017 is calculated as:

ROA %	=	Net Income (Q: Sep. 2017 )	/	( (Total Assets (Q: Jun. 2017 )	+	Total Assets (Q: Sep. 2017 ))	/ count )
	=	-1012	/	( (17564	+	16869)	/ 2 )
	=	-1012	/	17216.5
	=	-5.88 %

In the calculation of annual ROA %, the net income of the last fiscal year and the average total assets over the fiscal year are used. In calculating the quarterly data, the Net Income data used here is four times the quarterly (Sep. 2017) net income data. ROA % is displayed in the 30-year financial page.

Agrium (NYSE:AGU) ROA % Explanation

ROA % measures the rate of return on the total assets (shareholder equity plus liabilities). It measures a firm's efficiency at generating profits from shareholders' equity plus its liabilities. ROA % shows how well a company uses what it has to generate earnings. ROA %s can vary drastically across industries. Therefore, ROA % should not be used to compare companies in different industries. For retailers, a ROA % of higher than 5% is expected. For example, Wal-Mart (WMT) has a ROA % of about 8% as of 2012. For banks, ROA % is close to their interest spread. A banks ROA % is typically well under 2%.

Similar to ROE, ROA % is affected by profit margins and asset turnover. This can be seen from the Du Pont Formula:

	ROA %		(Q: Sep. 2017 )
=	Net Income	/	Total Assets
=	-1012	/	17216.5
=	(Net Income / Revenue)	*	(Revenue / Total Assets)
=	(-1012 / 9528)	*	(9528 / 17216.5)
=	Net Margin %	*	Asset Turnover
=	-10.62 %	*	0.5534
=	-5.88 %

Note: The Net Income data used here is four times the quarterly (Sep. 2017) net income data. The Revenue data used here is four times the quarterly (Sep. 2017) revenue data.

Be Aware

Like ROE, ROA % is calculated with only 12 months data. Fluctuations in the company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective. ROA % can be affected by events such as stock buyback or issuance, and by goodwill, a company's tax rate and its interest payment. ROA % may not reflect the true earning power of the assets. A more accurate measurement is ROC % (ROC).

Many analysts argue the higher return the better. Buffett states that really high ROA % may indicate vulnerability in the durability of the competitive advantage.

E.g. Raising $43b to take on KO is impossible, but $1.7b to take on Moody's is. Although Moody's ROA % and underlying economics is far superior to Coca Cola, the durability is far weaker because of lower entry cost.

Agrium ROA % Related Terms

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Agrium (Agrium) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Basic Materials » Agriculture » Agrium Inc (NYSE:AGU) » Definitions » ROA %

Comparable Companies

Traded in Other Exchanges

N/A

Address

Website

http://www.agrium.com

With more than 1,400 retail centers, Canada-based Agrium is the largest agricultural retailer in the United States, selling fertilizers, crop chemicals, and seed directly to farm customers. The company's wholesale business produces and markets the three main crop nutrients--nitrogen, potash, and phosphate--with natural resources located mainly in Canada and the United States. The bulk of Agrium's sales are generated in the U.S., Canada, and Australia.