ROA % is calculated as Net Income divided by its average Total Assets over a certain period of time. The Estee Lauder's annualizedNet Income for the quarter that ended in Sep. 2024 was $-624 Mil.
The Estee Lauder's average Total Assets over the quarter that ended in Sep. 2024 was $21,497 Mil. Therefore, The Estee Lauder's annualized ROA % for the quarter that ended in Sep. 2024 was -2.90%.
The historical rank and industry rank for The Estee Lauder's ROA % or its related term are showing as below:
EL'
s ROA % Range Over the Past 10 Years
Min: 0.91 Med: 11.58 Max: 14.44
Current: 0.91
During the past 13 years, The Estee Lauder's highest ROA % was 14.44%. The lowest was 0.91%. And the median was 11.58%.
EL's ROA % is ranked worse than 66.84% of 1915
companies
in the Consumer Packaged Goods industry
Industry Median: 3.28
vs EL: 0.91
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.
Competitive Comparison of The Estee Lauder's ROA %
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's ROA % Distribution in the Consumer Packaged Goods Industry
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 into.
The Estee Lauder ROA % Calculation
The Estee Lauder's annualized ROA % for the fiscal year that ended in Jun. 2024 is calculated as:
* 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 (Sep. 2024) net income data.
ROA % is displayed in the 30-year financial page.
The Estee Lauder (NYSE: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 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:
Note:
The Net Income data used here is four times the quarterly (Sep. 2024) net income data. The Revenue data used here is four times the quarterly (Sep. 2024) 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
Thank you for viewing the detailed overview of The Estee Lauder's ROA % provided by GuruFocus.com. Please click on the following links to see related term pages.
Estee Lauder is a leader in the global prestige beauty market, participating across skin care (51% of fiscal 2024 sales), makeup (29%), fragrance (16%), and hair care (4%) categories, with top-selling brands such as Estee Lauder, Clinique, M.A.C, La Mer, Jo Malone London, Aveda, Bobbi Brown, and Origins. The firm operates in more than 150 countries, generating 30% of revenue from the Americas, 39% from Europe, the Middle East and Africa (including travel retail), and 31% from Asia-Pacific. Estee Lauder sells its products through department stores, travel retail, specialty multibrand beauty stores, brand-dedicated freestanding stores, e-commerce, salons/spas, and perfumeries.
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