Return on Equity (ROE)
since 2020
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Carrier Global Corp. pages available for free this week:
- Statement of Comprehensive Income
- Analysis of Profitability Ratios
- Analysis of Liquidity Ratios
- Analysis of Solvency Ratios
- Analysis of Short-term (Operating) Activity Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Dividend Discount Model (DDM)
- Present Value of Free Cash Flow to Equity (FCFE)
- Price to Earnings (P/E) since 2020
- Price to Sales (P/S) since 2020
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Calculation
Carrier Global Corp., ROE, long-term trends, calculation
| ROE | = | 100 | × | Net income attributable to common shareowners1 | ÷ | Equity attributable to common shareowners1 | |
|---|---|---|---|---|---|---|---|
| Dec 31, 2022 | = | 100 | × | ÷ | |||
| Dec 31, 2021 | = | 100 | × | ÷ | |||
| Dec 31, 2020 | = | 100 | × | ÷ |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 US$ in millions
Return on Equity (ROE) exhibited considerable fluctuation between 2020 and 2022. A review of the period reveals a peak in 2020, followed by a decline, and a substantial recovery in the most recent year presented.
- Net Income Attributable to Common Shareowners
- Net income decreased from US$1,982 million in 2020 to US$1,664 million in 2021, representing a decline. However, a significant increase was observed in 2022, with net income reaching US$3,534 million.
- Equity Attributable to Common Shareowners
- Equity attributable to common shareowners demonstrated a consistent upward trend throughout the analyzed period. It increased from US$6,252 million in 2020 to US$6,767 million in 2021, and further to US$7,758 million in 2022.
- Return on Equity (ROE)
- ROE began at 31.70% in 2020. A decrease was noted in 2021, with ROE falling to 24.59%. The most recent year, 2022, saw a substantial increase in ROE, reaching 45.55%. This increase is attributable to the combined effect of increased net income and a growing equity base, with the income growth being the primary driver.
The substantial increase in ROE in 2022 suggests improved profitability relative to shareholder equity. The growth in equity, while consistent, did not offset the more significant rise in net income, resulting in the elevated ROE figure. The decline in ROE from 2020 to 2021 warrants further investigation to understand the underlying factors contributing to the reduced profitability during that period.
Comparison to Competitors
Carrier Global Corp., ROE, long-term trends, comparison to competitors
| Carrier Global Corp. | Boeing Co. | Caterpillar Inc. | Eaton Corp. plc | GE Aerospace | Honeywell International Inc. | Lockheed Martin Corp. | RTX Corp. | |
|---|---|---|---|---|---|---|---|---|
| Dec 31, 2022 | ||||||||
| Dec 31, 2021 | ||||||||
| Dec 31, 2020 |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
Comparison to Sector (Capital Goods)
Carrier Global Corp., ROE, long-term trends, comparison to sector (capital goods)
| Carrier Global Corp. | Capital Goods | |
|---|---|---|
| Dec 31, 2022 | ||
| Dec 31, 2021 | ||
| Dec 31, 2020 |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
Comparison to Industry (Industrials)
Carrier Global Corp., ROE, long-term trends, comparison to industry (industrials)
| Carrier Global Corp. | Industrials | |
|---|---|---|
| Dec 31, 2022 | ||
| Dec 31, 2021 | ||
| Dec 31, 2020 |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).