Should We Be Delighted With The Southern Company's (NYSE:SO) ROE Of 12%?
Should We Be Delighted With The Southern Company's (NYSE:SO) ROE Of 12%?
While some investors are already well versed in financial metrics (hat tip), this article is for those who would like to learn about Return On Equity (ROE) and why it is important. To keep the lesson grounded in practicality, we'll use ROE to better understand The Southern Company (NYSE:SO).
虽然一些投资者已经对财务指标了如指掌(转帽),但本文是为那些想了解回报率(roe)及其重要性的人而写的。为了让课堂内容更加实际,我们将使用roe来更好地理解南方公司(纽交所:so)。
ROE or return on equity is a useful tool to assess how effectively a company can generate returns on the investment it received from its shareholders. Simply put, it is used to assess the profitability of a company in relation to its equity capital.
roe或股东权益回报率是评估公司如何有效地从股东那里获得回报的有用工具。简而言之,它用于评估公司相对于其权益资本的盈利能力。
How Is ROE Calculated?
净资产收益率怎么计算?
The formula for return on equity is:
权益回报率的计算公式是:
Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity
净资产收益率 = 净利润(从持续经营中获得)÷ 股东权益
So, based on the above formula, the ROE for Southern is:
所以,根据上述公式,南方公司的roe为:
12% = US$4.5b ÷ US$36b (Based on the trailing twelve months to June 2024).
12% = 45亿美元 ÷ 360亿美元(基于截至2024年6月的过去12个月)。
The 'return' refers to a company's earnings over the last year. One way to conceptualize this is that for each $1 of shareholders' capital it has, the company made $0.12 in profit.
“回报”指的是公司过去一年的收益。一种概念化的方法是,在每1美元股东资本的基础上,公司获得了0.12美元的利润。
Does Southern Have A Good ROE?
南方是否有良好的roe?
One simple way to determine if a company has a good return on equity is to compare it to the average for its industry. Importantly, this is far from a perfect measure, because companies differ significantly within the same industry classification. As you can see in the graphic below, Southern has a higher ROE than the average (9.2%) in the Electric Utilities industry.
确定公司是否拥有良好的净资产收益率的一个简单方法是将其与所在行业的平均水平进行比较。值得注意的是,这并不是一个完美的衡量标准,因为在同一行业分类中企业之间存在较大差异。如下图所示,南方电力公司的roe高于电力公用股行业的平均水平(9.2%)。
![1724764300507](https://usnewsfile.moomoo.com/public/MM-PersistNewsContentImage/7781/20240827/42947970-0-b8cd7872ef2dd224e74d205ca8e474d8.webp/bigjpg)
That's clearly a positive. With that said, a high ROE doesn't always indicate high profitability. Especially when a firm uses high levels of debt to finance its debt which may boost its ROE but the high leverage puts the company at risk. You can see the 3 risks we have identified for Southern by visiting our risks dashboard for free on our platform here.
这显然是一种积极的现象。尽管如此,高roe并不总是意味着高盈利能力。特别是当企业使用高杠杆来融资时,高杠杆可能会提高公司的roe,但也会使公司面临风险。您可以免费在我们的平台上访问我们针对南方电力公司确定的三个风险仪表板来了解更多信息。
How Does Debt Impact Return On Equity?
债务如何影响股东回报率?
Companies usually need to invest money to grow their profits. That cash can come from retained earnings, issuing new shares (equity), or debt. In the case of the first and second options, the ROE will reflect this use of cash, for growth. In the latter case, the use of debt will improve the returns, but will not change the equity. That will make the ROE look better than if no debt was used.
公司通常需要投资资金来提高利润。这些资金可以来自留存收益、发行新股(股权)或债务。在第一和第二种选择的情况下,roe将反映这种用于增长的资金使用情况。在后一种情况下,债务的使用将提高回报率,但不会改变净资产。这将使roe看起来比没有使用债务时更好。
Combining Southern's Debt And Its 12% Return On Equity
将Southern的债务和其12%的净资产收益率相结合
Southern does use a high amount of debt to increase returns. It has a debt to equity ratio of 1.77. The combination of a rather low ROE and significant use of debt is not particularly appealing. Debt increases risk and reduces options for the company in the future, so you generally want to see some good returns from using it.
Southern确实使用了大量的债务来提高回报。其债务与股东权益比率为1.77。相对较低的净资产收益率和大量使用债务的结合并不特别吸引人。债务增加了风险,减少了公司未来的选择,因此您通常希望从中获得一些良好的回报。
Conclusion
结论
Return on equity is useful for comparing the quality of different businesses. Companies that can achieve high returns on equity without too much debt are generally of good quality. If two companies have the same ROE, then I would generally prefer the one with less debt.
股本回报率有助于比较不同企业的质量。能够在不太多债务的情况下实现高roe的公司通常都是高质量的。如果两家公司的roe相同,则我通常更喜欢那家负债较少的公司。
Having said that, while ROE is a useful indicator of business quality, you'll have to look at a whole range of factors to determine the right price to buy a stock. Profit growth rates, versus the expectations reflected in the price of the stock, are a particularly important to consider. So I think it may be worth checking this free report on analyst forecasts for the company.
话虽如此,虽然ROE是业务质量的有用指标,但您需要研究各种因素来确定购买股票的正确价格。利润增长速度与反映在股票价格中的预期是特别重要的考虑因素。因此,我认为值得查看该公司分析师预测的免费报告。
Of course Southern may not be the best stock to buy. So you may wish to see this free collection of other companies that have high ROE and low debt.
当然,Southern可能不是最好的股票可供购买。因此,您可能希望查看这个自由的公司收藏,其中包括具有高净资产收益率和低债务的其他公司。
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