Return on Total Assets (TTM)
factor.formula
Return on Total Assets (TTM):
Average total assets
in:
- :
Refers to the sum of operating profits for the most recent 12 consecutive months. Using TTM can smooth seasonal fluctuations and more accurately reflect the company's continued profitability. Operating profit refers to the profit generated by the company in its operating activities, which is the profit after deducting operating costs, taxes and surcharges, but does not include non-operating income and expenses.
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Refers to the average of total assets at the beginning and end of the reporting period. Total assets include all assets of the company, such as cash, accounts receivable, inventory, fixed assets, etc., which can more accurately reflect the company's ability to use all assets to create profits during the reporting period. The average value is used to avoid the impact of sudden changes in total assets at the end of the period on the indicator.
factor.explanation
Return on assets (ROA) is a key indicator to measure a company's profitability and asset operating efficiency. This indicator uses operating profit for the most recent 12 months rather than net profit, because operating profit better reflects the profitability of the main business and avoids the impact of non-recurring gains and losses. By comparing the return on assets of different companies or the same company over different periods, investors can evaluate the company's asset utilization efficiency and profitability. A higher ROA indicates that the company is able to use its assets more effectively to generate profits, thereby bringing higher returns to shareholders.