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The Estee Lauder (MEX:EL) ROA %

: 7.65% (As of Dec. 2022)
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ROA % is calculated as Net Income divided by its average Total Assets over a certain period of time. The Estee Lauder's annualized Net Income for the quarter that ended in Dec. 2022 was MXN30,913 Mil. The Estee Lauder's average Total Assets over the quarter that ended in Dec. 2022 was MXN403,896 Mil. Therefore, The Estee Lauder's annualized ROA % for the quarter that ended in Dec. 2022 was 7.65%.

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

MEX:EL' s ROA % Range Over the Past 10 Years
Min: 4.42   Med: 13.16   Max: 16.04
Current: 7.1

During the past 13 years, The Estee Lauder's highest ROA % was 16.04%. The lowest was 4.42%. And the median was 13.16%.

MEX:EL's ROA % is ranked better than
74.74% of 1853 companies
in the Consumer Packaged Goods industry
Industry Median: 2.76 vs MEX:EL: 7.10

The Estee Lauder ROA % Historical Data

The historical data trend for The Estee Lauder'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.

* Premium members only.

The Estee Lauder Annual Data
Trend Jun13 Jun14 Jun15 Jun16 Jun17 Jun18 Jun19 Jun20 Jun21 Jun22
ROA %
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 9.68 13.53 4.69 13.74 11.14

The Estee Lauder Quarterly Data
Mar18 Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22
ROA % Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 20.36 10.18 0.97 9.58 7.65

Competitive Comparison

For the Household & Personal Products subindustry, The Estee Lauder'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.

   

The Estee Lauder ROA % Distribution

For the Consumer Packaged Goods industry and Consumer Defensive sector, The Estee Lauder's ROA % distribution charts can be found below:

* The bar in red indicates where The Estee Lauder's ROA % falls in comparison to its industry or sector. The grey bar indicates the ROA %'s extreme value range as defined by GuruFocus.



The Estee Lauder ROA % Calculation

The Estee Lauder's annualized ROA % for the fiscal year that ended in Jun. 2022 is calculated as:

ROA %=Net Income (A: Jun. 2022 )/( (Total Assets (A: Jun. 2021 )+Total Assets (A: Jun. 2022 ))/ count )
=47824.139042885/( (440109.88897514+418411.1913752)/ 2 )
=47824.139042885/429260.54017517
=11.14 %

The Estee Lauder's annualized ROA % for the quarter that ended in Dec. 2022 is calculated as:

ROA %=Net Income (Q: Dec. 2022 )/( (Total Assets (Q: Sep. 2022 )+Total Assets (Q: Dec. 2022 ))/ count )
=30912.924810768/( (401157.24181018+406634.41894164)/ 2 )
=30912.924810768/403895.83037591
=7.65 %

* 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.

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 (Dec. 2022) net income data. ROA % is displayed in the 30-year financial page.


The Estee Lauder  (MEX:EL) 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 bank’s 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: Dec. 2022 )
=Net Income/Total Assets
=30912.924810768/403895.83037591
=(Net Income / Revenue)*(Revenue / Total Assets)
=(30912.924810768 / 362481.50412626)*(362481.50412626 / 403895.83037591)
=Net Margin %*Asset Turnover
=8.53 %*0.8975
=7.65 %

Note: The Net Income data used here is four times the quarterly (Dec. 2022) net income data. The Revenue data used here is four times the quarterly (Dec. 2022) revenue data.

* 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.


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.


The Estee Lauder ROA % Related Terms

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The Estee Lauder (MEX:EL) Business Description

The Estee Lauder logo
Traded in Other Exchanges
Address
767 Fifth Avenue, New York, NY, USA, 10153
Estee Lauder is the world leader in the global prestige beauty market, participating across skincare (56% of fiscal 2022 sales), makeup (26%), fragrance (14%), and haircare (4%) categories, with popular brands such as Estee Lauder, Clinique, MAC, La Mer, Jo Malone, Aveda, Bobbi Brown, Too Faced, Origins, Dr. Jart+, and The Ordinary. The firm operates in 150 countries, with 26% of fiscal 2022 revenue stemming from the Americas, 43% from Europe, the Middle East and Africa, and 31% from Asia-Pacific. The company sells its products through department stores, travel retail, multibrand specialty beauty stores, brand-dedicated freestanding stores, e-commerce, salons/spas, and perfumeries.

The Estee Lauder (MEX:EL) Headlines

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