During Q2, American Airlines Group (NASDAQ: AAL) brought in sales totaling $1.62 billion. However, earnings decreased 2.47%, resulting in a loss of $2.49 billion. In Q1, American Airlines Group brought in $8.52 billion in sales but lost $2.55 billion in earnings.
What Is ROCE?
Changes in earnings and sales indicate shifts in American Airlines Group’s Return on Capital Employed, a measure of yearly pre-tax profit relative to capital employed in a business. Generally, a higher ROCE suggests successful growth in a company and is a sign of higher earnings per share for shareholders in the future. In Q2, American Airlines Group posted an ROCE of 0.78%.
It is important to keep in mind ROCE evaluates past performance and is not used as a predictive tool. It is a good measure of a company’s recent performance, but several factors could affect earnings and sales in the near…