Understanding Universal Logistics Holdings' Return on Equity: A Financial Analysis

Universal Logistics Holdings' ROE is 9.3%, which is lower than the average for the Transportation industry. The ROE can be calculated using the formula: Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity. The company's ROE is based on the trailing twelve months to June 2025, and is calculated as $61m ÷ $654m. This means that for every $1 worth of shareholders' equity, the company generated $0.09 in profit.

Universal Logistics Holdings' (ULH) Return on Equity (ROE) stands at 9.3%, which is below the average for the Transportation industry. To understand this metric, we need to delve into the company's financial performance and industry benchmarks.

Calculating ROE

ROE is calculated using the formula:

\[ \text{ROE} = \frac{\text{Net Profit (from continuing operations)}}{\text{Shareholders' Equity}} \]

For Universal Logistics Holdings, the ROE for the trailing twelve months to June 2025 is calculated as:

\[ \text{ROE} = \frac{\$61 \text{m}}{\$654 \text{m}} = 0.093 \]

This means that for every $1 worth of shareholders' equity, the company generated $0.09 in profit.

Industry Comparison

The average ROE for the Transportation industry is 12%. ULH's ROE of 9.3% is below this benchmark, indicating that the company is generating less profit relative to its shareholders' equity compared to its industry peers.

Financial Performance

Universal Logistics Holdings reported net sales of $1,736.51 million and a net profit of $83.46 million over the latest four quarters, as of June 2025 [2]. The company's high use of debt, with a debt-to-equity ratio of 1.22, may pose risks and limit future options for growth [2].

Technical Indicators

Technical indicators suggest a potential upward trend for ULH. A bullish trend has been observed on the 15-minute chart, with a KDJ Golden Cross and Bullish Marubozu pattern on August 26, 2025, at 15:30 [1]. These indicators suggest that the momentum of the stock price is shifting in favor of the upside, indicating potential for further price increases.

Investment Considerations

While the recent technical indicators suggest a potential upward trend, investors should consider other financial metrics and risks associated with the company. The company's lower ROE compared to industry peers may indicate that it is not as efficient in generating profits from its equity. Additionally, the company's high debt levels may pose risks to its financial stability.

Conclusion

Universal Logistics Holdings' ROE of 9.3% is below the industry average, indicating that the company may not be as efficient in generating profits relative to its shareholders' equity. However, recent technical indicators suggest a potential upward trend in the stock price. Investors should closely monitor the company's financial health and market conditions for further insights.

References:

[1] https://www.ainvest.com/news/universal-logistics-holdings-sees-kdj-golden-cross-bullish-marubozu-15-minute-chart-2508/
[2] https://www.marketsmojo.com/stocks-analysis/universal-logistics-holdings-inc-1162265-210