Analysis of Profitability Ratios
Quarterly Data
Profitability ratios measure the company ability to generate profitable sales from its resources (assets).
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- Income Statement
- Balance Sheet: Assets
- Balance Sheet: Liabilities and Stockholders’ Equity
- Cash Flow Statement
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Present Value of Free Cash Flow to Equity (FCFE)
- Return on Equity (ROE) since 2005
- Price to Operating Profit (P/OP) since 2005
- Price to Book Value (P/BV) since 2005
- Aggregate Accruals
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Profitability Ratios (Summary)
Align Technology Inc., profitability ratios (quarterly data)
Based on: 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
The financial performance indicators exhibit several notable trends over the observed periods. The gross profit margin shows a generally declining trend from around 73% in early 2019 to about 69.7% by late 2023, indicating a gradual reduction in profitability at the gross level. This decline may reflect increased costs of goods sold or competitive pricing pressures.
The operating profit margin displays more volatility. Initially steady near the low twenties percent through 2019 and early 2020, it sharply decreased to a low of approximately 12.7% in mid-2020. A recovery phase follows, reaching a peak above 25% by mid to late 2021, before again trending downward to about 15% by late 2023. This pattern suggests operational challenges particularly around 2020, possibly linked to external disruptions, followed by improved operational efficiency, and a more recent decline in profitability.
Net profit margin follows an unusual pattern with an extreme peak around 78% in the first three quarters of 2020. This is inconsistent with other margin figures and may imply the presence of extraordinary income, accounting adjustments, or one-time items during that timeframe. Post-2020, the net margin normalizes to a range between approximately 8.5% and 20%, but generally trends downward from 2021 onwards, shrinking to below 10% by late 2023.
Return on equity (ROE) also exhibits substantial fluctuations. It starts near 30% in early 2019, sharply rises to over 60% during 2020, likely influenced by the same factors affecting the net margin. Subsequently, it declines steadily to under 10% by late 2023. The decreasing ROE in recent years indicates diminishing effectiveness in generating profit from shareholders' equity.
Return on assets (ROA) conveys a similar narrative, with a peak above 47% in early 2020, followed by a decline to around 5-6% by late 2023. This reduction in ROA reflects diminishing efficiency in using assets to generate earnings over time.
Overall, the data reveals that 2020 was an anomalous year with unusually high net profitability and returns, which were not sustained. Since 2021, there is a clear downward trajectory in profitability and efficiency measures, signaling potential challenges in maintaining profit margins and returns. Operational profitability shows moderate recovery mid-period but weakens towards the end of the timeline, while the gross margin displays a steady erosion over five years.
- Gross Profit Margin
- Declined gradually from approximately 73% in early 2019 to below 70% by late 2023, indicating increasing cost pressures or margin compression.
- Operating Profit Margin
- Experienced significant volatility, dropping sharply in 2020 to under 13%, recovering above 25% in 2021, then decreasing again to about 15% by 2023.
- Net Profit Margin
- Displayed an extraordinary surge above 75% in 2020, followed by a normalization and gradual decrease to around 9-10% in 2023.
- Return on Equity (ROE)
- Peaked above 60% in 2020 but has since declined steadily, falling below 10% by the end of 2023.
- Return on Assets (ROA)
- Mirrored ROE’s trend with a maximal value above 47% in 2020, decreasing gradually to about 5-6% by 2023.
Return on Sales
Return on Investment
Gross Profit Margin
Align Technology Inc., gross profit margin calculation (quarterly data)
| Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||||||||||||||||||||
| Gross profit | |||||||||||||||||||||||||
| Net revenues | |||||||||||||||||||||||||
| Profitability Ratio | |||||||||||||||||||||||||
| Gross profit margin1 | |||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||
| Gross Profit Margin, Competitors2 | |||||||||||||||||||||||||
| Abbott Laboratories | |||||||||||||||||||||||||
| Elevance Health Inc. | |||||||||||||||||||||||||
| Intuitive Surgical Inc. | |||||||||||||||||||||||||
| Medtronic PLC | |||||||||||||||||||||||||
| UnitedHealth Group Inc. | |||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q3 2023 Calculation
Gross profit margin = 100
× (Gross profitQ3 2023
+ Gross profitQ2 2023
+ Gross profitQ1 2023
+ Gross profitQ4 2022)
÷ (Net revenuesQ3 2023
+ Net revenuesQ2 2023
+ Net revenuesQ1 2023
+ Net revenuesQ4 2022)
= 100 × ( + + + )
÷ ( + + + )
=
2 Click competitor name to see calculations.
The analysis of the quarterly financial indicators reveals several noteworthy trends in the company's performance over the observed periods.
- Gross Profit
- Gross profit exhibited fluctuations across the quarters, starting at approximately $402 million in the first quarter of 2019 and generally increasing to reach a peak of around $758 million in the middle of 2021. However, following this peak, a downward trend can be observed, with gross profit decreasing to approximately $617 million by the end of 2022, before showing a modest recovery to about $713 million in mid-2023 and subsequently dipping again to near $663 million in the third quarter of 2023.
- Net Revenues
- Net revenues show an overall growth trend from Q1 2019 through mid-2021, increasing from roughly $549 million to over $1 billion. The growth trajectory includes a notable dip during the early quarters of 2020, likely linked to external factors impacting the market. Following recovery and continued growth, revenues peaked around $1.03 billion in late 2021. From early 2022 onwards, net revenues experienced some volatility and a downward revision to below $1 billion towards the end of the period, with intermittent rises around mid-2023.
- Gross Profit Margin
- The gross profit margin remained relatively stable throughout the period, oscillating mostly in the low 70% range. It started at approximately 73.25% in early 2019 and peaked at around 74.58% in the third quarter of 2021. Afterwards, the margin experienced a gradual decline, falling below 70% in the early quarters of 2023, settling around 69.74% by the latest quarter. This trend suggests slight pressure on profitability relative to revenues over recent periods.
In summary, the financials reflect a phase of growth characterized by rising revenues and gross profit up to late 2021, followed by a period of instability and mild decline. The gross profit margin, while relatively stable, shows signs of compression in recent quarters, indicating potential challenges in cost control or pricing pressures. The fluctuations in both revenues and gross profit highlight the variability in the operating environment experienced by the company during these years.
Operating Profit Margin
Align Technology Inc., operating profit margin calculation (quarterly data)
| Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||||||||||||||||||||
| Income (loss) from operations | |||||||||||||||||||||||||
| Net revenues | |||||||||||||||||||||||||
| Profitability Ratio | |||||||||||||||||||||||||
| Operating profit margin1 | |||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||
| Operating Profit Margin, Competitors2 | |||||||||||||||||||||||||
| Abbott Laboratories | |||||||||||||||||||||||||
| Elevance Health Inc. | |||||||||||||||||||||||||
| Intuitive Surgical Inc. | |||||||||||||||||||||||||
| Medtronic PLC | |||||||||||||||||||||||||
| UnitedHealth Group Inc. | |||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q3 2023 Calculation
Operating profit margin = 100
× (Income (loss) from operationsQ3 2023
+ Income (loss) from operationsQ2 2023
+ Income (loss) from operationsQ1 2023
+ Income (loss) from operationsQ4 2022)
÷ (Net revenuesQ3 2023
+ Net revenuesQ2 2023
+ Net revenuesQ1 2023
+ Net revenuesQ4 2022)
= 100 × ( + + + )
÷ ( + + + )
=
2 Click competitor name to see calculations.
- Income from operations
- The income from operations exhibits considerable volatility across the observed quarters. Initially, it increased steadily from 87.7 million USD in Q1 2019 to a peak of approximately 176.5 million USD in Q2 2019. Subsequently, there was a decline and fluctuation around 127 to 151 million USD until Q4 2019. A sharp decline was observed in Q2 2020, with a loss of 73 million USD, likely reflecting extraordinary challenges during this period. Recovery was notable from Q3 2020 onwards, reaching a high of 268.9 million USD in Q2 2021. However, post this peak, there was a gradual decrease again, falling to around 112.7 million USD by Q4 2022, followed by a slight recovery towards Q3 2023 with income of approximately 166.3 million USD.
- Net revenues
- Net revenues demonstrated an overall upward trajectory from Q1 2019 through Q4 2021. Revenues grew from approximately 549 million USD in Q1 2019, peaking at about 1.03 billion USD in Q4 2021. Despite this strong growth, revenues experienced a notable dip beginning in Q1 2020, descending to a low of around 352 million USD in Q2 2020, coinciding with the period of operational losses. Following this trough, revenues rebounded significantly, regaining and surpassing pre-dip levels through 2021. From 2022 onwards, net revenues exhibited a mild declining trend, fluctuating between approximately 890 million and 1.0 billion USD, without a clear directional movement.
- Operating profit margin
- The operating profit margin trends illustrate the impact of revenue and operational income fluctuations on profitability. Margins held relatively stable in 2019, ranging from around 21.9% to 23.3%. In 2020, there was a marked decline during the first half, dropping to a low of 12.74% in Q2, commensurate with the reported operational loss. Margins improved gradually afterward, reaching a peak of 25.79% in Q3 2021, reflecting the period of high operational income and revenue growth. Subsequently, operating profit margins declined steadily to an approximate 15.0% level by Q3 2023, indicating either increased operating costs or reduced pricing power relative to revenue levels in recent quarters.
- Summary of trends and insights
- The data reveals a period of strong growth in both revenues and operating income until early 2020, followed by a sharp downturn mid-2020, likely influenced by external or extraordinary factors. Post-2020, there was a robust recovery in operational performance and revenues into 2021, culminating in record margins and income figures. Starting in 2022, a gradual decline in profitability and revenues was observed, with operating margins shrinking to mid-teens percentages. This pattern may suggest increasing market pressures, cost challenges, or demand fluctuations affecting recent quarters. The overall trend emphasizes volatility and recovery phases with recent moderate weakening in operating efficiency.
Net Profit Margin
Align Technology Inc., net profit margin calculation (quarterly data)
| Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||||||||||||||||||||
| Net income (loss) | |||||||||||||||||||||||||
| Net revenues | |||||||||||||||||||||||||
| Profitability Ratio | |||||||||||||||||||||||||
| Net profit margin1 | |||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||
| Net Profit Margin, Competitors2 | |||||||||||||||||||||||||
| Abbott Laboratories | |||||||||||||||||||||||||
| Elevance Health Inc. | |||||||||||||||||||||||||
| Intuitive Surgical Inc. | |||||||||||||||||||||||||
| Medtronic PLC | |||||||||||||||||||||||||
| UnitedHealth Group Inc. | |||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q3 2023 Calculation
Net profit margin = 100
× (Net income (loss)Q3 2023
+ Net income (loss)Q2 2023
+ Net income (loss)Q1 2023
+ Net income (loss)Q4 2022)
÷ (Net revenuesQ3 2023
+ Net revenuesQ2 2023
+ Net revenuesQ1 2023
+ Net revenuesQ4 2022)
= 100 × ( + + + )
÷ ( + + + )
=
2 Click competitor name to see calculations.
The financial data exhibits notable fluctuations across the analyzed periods, highlighting significant operational and profitability trends.
- Net Income (Loss)
- The net income showed a general upward trend from March 2019 through March 2020, peaking dramatically in the first quarter of 2020 with an exceptional increase to over 1.5 billion USD from prior quarterly figures in the hundreds of thousands. This spike appears anomalous compared to other periods. Following this peak, the company experienced a sharp loss in the second quarter of 2020. Subsequently, net income recovered and remained positive through 2021, though generally fluctuating downward from the peak levels of early 2020. During 2022 and into 2023, net income exhibited a declining trend overall, with quarterly figures diminishing from approximately 134 million USD in early 2022 to roughly 121 million USD by late 2023, indicating reduced profitability over this timeframe.
- Net Revenues
- Net revenues showed a consistent upward trajectory from early 2019 to late 2021. The company’s revenues rose steadily from approximately 549 million USD in the first quarter of 2019 to surpassing one billion USD by mid-2021. However, from late 2021 onwards, there was a gradual decline in revenues reaching around 960 million USD by late 2023, suggesting a slight contraction or stabilization after a period of growth.
- Net Profit Margin (%)
- The net profit margin percentages follow an irregular pattern. Margins were stable and relatively moderate through 2019, remaining below 20%. In early 2020, margins surged dramatically above 70%, which coincides with the abnormal spike in net income, reflecting unusual profitability during this period. After this peak, margins returned to single-digit and low double-digit percentages from 2021 onwards, decreasing from approximately 17.5% in early 2022 to just below 10% by late 2023. This decline suggests increasing cost pressures or reduced operational efficiency relative to revenues.
In summary, the data reveals an extraordinary event impacting profitability in early 2020, followed by stabilization and slight erosion in profitability and revenue growth through 2022 and 2023. The overall trends indicate that while revenues had grown strongly over several years, recent quarters showed slight contractions accompanied by reduced profit margins and net income, warranting attention to underlying operational or market factors influencing financial performance.
Return on Equity (ROE)
Align Technology Inc., ROE calculation (quarterly data)
| Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||||||||||||||||||||
| Net income (loss) | |||||||||||||||||||||||||
| Stockholders’ equity | |||||||||||||||||||||||||
| Profitability Ratio | |||||||||||||||||||||||||
| ROE1 | |||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||
| ROE, Competitors2 | |||||||||||||||||||||||||
| Abbott Laboratories | |||||||||||||||||||||||||
| Elevance Health Inc. | |||||||||||||||||||||||||
| Intuitive Surgical Inc. | |||||||||||||||||||||||||
| Medtronic PLC | |||||||||||||||||||||||||
| UnitedHealth Group Inc. | |||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q3 2023 Calculation
ROE = 100
× (Net income (loss)Q3 2023
+ Net income (loss)Q2 2023
+ Net income (loss)Q1 2023
+ Net income (loss)Q4 2022)
÷ Stockholders’ equity
= 100 × ( + + + )
÷ =
2 Click competitor name to see calculations.
- Net Income (Loss)
- The net income shows significant volatility over the analyzed periods. Beginning with relatively stable positive earnings through 2019, a dramatic spike occurs in the first quarter of 2020, reaching approximately 1.5 billion USD. This peak is followed by a substantial loss in the second quarter of 2020, indicating a sharp decline before recovering in subsequent quarters. From late 2020 through 2021, net income remains robust, averaging around 180 to 200 million USD per quarter. However, from early 2022 onwards, there is a clear downward trend with net income progressively decreasing each quarter, hitting the lowest figures in early and mid-2023 with amounts below 90 million USD.
- Stockholders’ Equity
- Stockholders’ equity exhibits a generally increasing trend throughout the entire period. Starting at approximately 1.25 billion USD in early 2019, the equity nearly doubles by early 2020, reaching close to 3 billion USD. After this sharp increase, equity continues to grow gradually through 2021 and 2022, surpassing 3.6 billion USD. The equity fluctuates slightly but maintains an overall upward trajectory, culminating near 3.8 billion USD by the third quarter of 2023. There are some marginal declines visible in the middle of 2022 and early 2023, but these are short-lived.
- Return on Equity (ROE)
- ROE demonstrates strong initial performance through 2019, with values ranging from around 30% to 33%. This metric experiences a dramatic rise in early 2020, reaching above 66%, coinciding with the peak in net income. Thereafter, ROE shows a pronounced decline, stabilizing in the 50% to 55% range during late 2020. Starting from 2021, ROE undergoes a steep downward trend, decreasing quarter-by-quarter to below 10% by mid-2023. This decline highlights a substantial decrease in profitability relative to stockholders’ equity in the most recent periods.
- Summary of Trends and Insights
- The financial data reflect a period of high earnings volatility, with an extraordinary income peak in the first quarter of 2020 and a sharp subsequent loss, possibly linked to unusual or non-recurring events. Despite this volatility, stockholders’ equity steadily increases, indicating consistent capital growth and possible equity infusions or retained earnings over time. The return on equity aligns with net income trends, reflecting initial profitability strength followed by a significant deterioration in relative returns in recent years. The downward trend in both net income and ROE since 2021 suggests potential challenges in maintaining profit margins or efficient capital utilization. The overall picture is of a company experiencing rapid growth and profitability surges in the early period, followed by a gradual softening of earnings performance while maintaining solid equity growth.
Return on Assets (ROA)
Align Technology Inc., ROA calculation (quarterly data)
| Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||||||||||||||||||||
| Net income (loss) | |||||||||||||||||||||||||
| Total assets | |||||||||||||||||||||||||
| Profitability Ratio | |||||||||||||||||||||||||
| ROA1 | |||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||
| ROA, Competitors2 | |||||||||||||||||||||||||
| Abbott Laboratories | |||||||||||||||||||||||||
| Elevance Health Inc. | |||||||||||||||||||||||||
| Intuitive Surgical Inc. | |||||||||||||||||||||||||
| Medtronic PLC | |||||||||||||||||||||||||
| UnitedHealth Group Inc. | |||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q3 2023 Calculation
ROA = 100
× (Net income (loss)Q3 2023
+ Net income (loss)Q2 2023
+ Net income (loss)Q1 2023
+ Net income (loss)Q4 2022)
÷ Total assets
= 100 × ( + + + )
÷ =
2 Click competitor name to see calculations.
The financial analysis over the examined periods reveals several notable trends in profitability, asset growth, and return on assets (ROA) for the company.
- Net Income (Loss)
- The net income exhibited strong fluctuations. Initially, net income rose from $71.8 million in Q1 2019, reaching a notable peak of $1.52 billion in Q2 2020, which stands out dramatically compared to other quarters. Following this peak, net income reverted to more typical levels ranging between approximately $40 million and $200 million through 2023. This peak in mid-2020 likely reflects extraordinary gains or events during that period. Subsequent quarters show a decline from the earlier record high, with values generally stabilizing but trending downward towards late 2022 and early 2023 before slight recovery by Q3 2023.
- Total Assets
- There is a clear and consistent upward trajectory in total assets throughout the entire period. Assets increased from $2.23 billion in Q1 2019 to $6.32 billion by Q3 2023, nearly tripling over the period. This steady growth represents strong investment or acquisition activity and indicates an expanding asset base supporting the company’s operations. There were no periods of asset decline, suggesting ongoing asset accumulation or appreciation.
- Return on Assets (ROA)
- The ROA figures show significant volatility, especially around the mid-2020 period. ROA began around 17% in early 2019, spiked sharply to an extraordinary 48% in Q2 2020, and gradually decreased in subsequent quarters. Post-2020, ROA moved downward steadily, falling to a low of approximately 5% by mid-2023. The initial spike corresponds to the extraordinary net income recorded in Q2 2020, while the subsequent decline in ROA reflects normalization of profits relative to the expanded asset base.
- Overall Trends and Insights
- The company experienced extraordinary profitability in mid-2020, reflected by unusually high net income and ROA values. Following this event, profitability metrics normalized but demonstrated a declining trend in efficiency, as shown by decreasing ROA despite rising total assets. The consistent growth in total assets suggests strategic expansion or capital investment. However, declining returns on these assets indicate either reduced profit margins or increased asset base not yet translating proportionally into profits. Recent quarters show modest recovery in net income and ROA, which may suggest operational improvements or market adjustments.