Return on Assets (ROA)
since 2019
Calculation
Shockwave Medical Inc., ROA, long-term trends, calculation
| ROA | = | 100 | × | Net income (loss)1 | ÷ | Total assets1 | |
|---|---|---|---|---|---|---|---|
| Dec 31, 2023 | 9.40% | = | 100 | × | 147,278) | ÷ | 1,566,563) |
| Dec 31, 2022 | 33.43% | = | 100 | × | 215,996) | ÷ | 646,089) |
| Dec 31, 2021 | -2.64% | = | 100 | × | (9,136) | ÷ | 345,682) |
| Dec 31, 2020 | -24.15% | = | 100 | × | (65,699) | ÷ | 272,042) |
| Dec 31, 2019 | -22.04% | = | 100 | × | (51,109) | ÷ | 231,938) |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 US$ in thousands
The return on assets (ROA) exhibited a significant trajectory over the five-year period. Initially negative, the ROA progressively improved, culminating in a positive, though reduced, value in the most recent year.
- Net Income and ROA Relationship
- A strong correlation exists between net income and the ROA. The substantial losses reported in 2019 and 2020 directly contributed to the negative ROA values observed during those years. The transition to profitability in 2021, and particularly the significant net income in 2022, drove a substantial increase in ROA.
- ROA Trend: 2019-2022
- From 2019 to 2022, the ROA moved from -22.04% to 33.43%. This represents a dramatic improvement, indicating increasing efficiency in utilizing assets to generate profit. The largest single-year increase occurred between 2021 and 2022.
- ROA Trend: 2022-2023
- The ROA decreased from 33.43% in 2022 to 9.40% in 2023. While remaining positive, this decline suggests a reduced level of profitability relative to the asset base. This decrease coincides with a reduction in net income, despite a considerable increase in total assets.
- Asset Growth and ROA
- Total assets increased consistently throughout the period, with the most substantial growth occurring between 2022 and 2023. The ROA decline in 2023, despite increased net income, suggests that asset growth outpaced the growth in earnings, diluting the return on those assets. The company is deploying more capital, but not at the same rate of return as the prior year.
In summary, the ROA demonstrates a clear progression from substantial losses to significant profitability, followed by a moderation in returns. The recent increase in assets, coupled with a slower growth rate in net income, warrants further investigation to understand the drivers behind the decreased ROA in the latest period.
Comparison to Competitors
Shockwave Medical Inc., ROA, long-term trends, comparison to competitors
| Shockwave Medical Inc. | Abbott Laboratories | Elevance Health Inc. | Intuitive Surgical Inc. | Medtronic PLC | UnitedHealth Group Inc. | |
|---|---|---|---|---|---|---|
| Dec 31, 2023 | 9.40% | 7.82% | 5.50% | 11.64% | 4.13% | 8.18% |
| Dec 31, 2022 | 33.43% | 9.31% | 5.86% | 10.19% | 5.54% | 8.19% |
| Dec 31, 2021 | -2.64% | 9.40% | 6.26% | 12.58% | 3.87% | 8.15% |
| Dec 31, 2020 | -24.15% | 6.20% | 5.28% | 9.50% | 5.28% | 7.81% |
| Dec 31, 2019 | -22.04% | 5.43% | 6.21% | 14.17% | 5.16% | 7.96% |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
Comparison to Sector (Health Care Equipment & Services)
Shockwave Medical Inc., ROA, long-term trends, comparison to sector (health care equipment & services)
| Shockwave Medical Inc. | Health Care Equipment & Services | |
|---|---|---|
| Dec 31, 2023 | 9.40% | 7.05% |
| Dec 31, 2022 | 33.43% | 7.49% |
| Dec 31, 2021 | -2.64% | 7.28% |
| Dec 31, 2020 | -24.15% | 6.62% |
| Dec 31, 2019 | -22.04% | 6.77% |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
Comparison to Industry (Health Care)
Shockwave Medical Inc., ROA, long-term trends, comparison to industry (health care)
| Shockwave Medical Inc. | Health Care | |
|---|---|---|
| Dec 31, 2023 | 9.40% | 7.19% |
| Dec 31, 2022 | 33.43% | 9.66% |
| Dec 31, 2021 | -2.64% | 9.46% |
| Dec 31, 2020 | -24.15% | 5.81% |
| Dec 31, 2019 | -22.04% | 8.32% |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).