Amgen Inc. (NASDAQ:AMGN)

Return on Assets (ROA)

The ROA data, starting from March 31, 2020, reveals a fluctuating but generally declining trend. Initially, values were around 11.54% at the end of the first reported quarter in 2020, followed by moderate decreases through 2021 and into 2023. There is a mild downward slope evident, with ROA decreasing from above 10% to mid-single digits between 2023 and 2025. Notably, there was a dip to 4.05% in June 2024, followed by a slight recovery to 7.53% by June 2025. Overall, ROA reflects some volatility but signals a reduction in asset profitability over the observed periods.

Financial Leverage

The financial leverage ratio exhibits significant volatility and some very sharp spikes during the period. Starting modestly in early 2020 with ratios around 6.5 to 6.7, leverage sharply increased to an exceptionally high peak of 64.62 by March 31, 2022, before declining substantially to lower double digits thereafter. This extreme spike could indicate unusual financing activities or balance sheet restructuring during early 2022. Post-spike, the leverage ratio stabilizes in the range of approximately 11.8 to 18.5, showing some fluctuations but no return to the extreme peak. This pattern suggests episodes of rapid capital structure changes with attempts to moderate leverage subsequently.

Return on Equity (ROE)

ROE shows an initially strong performance with values near 77% at the beginning of the available dataset, but experiences dramatic spikes reaching a peak of 624.78% in June 2022. This outlier is followed by steep decreases while remaining elevated relative to the starting point, with values consistently above 50% through 2025, and a tendency to moderate to under 100% towards the most recent quarters. The unusual spike in mid-2022 aligns temporally with the peak in financial leverage, suggesting highly leveraged equity returns during that time. Despite substantial declines from the spike, the ROE remains significantly high overall, implying robust shareholder returns supported by leverage but also potential volatility risk.

The analysis of the quarterly financial data reveals several notable trends and fluctuations across key performance indicators over the period examined.

Net Profit Margin

The net profit margin showed variability with a gradual decline from the peak levels in early 2020. Starting around 29.97% in March 2020, it experienced some volatility but primarily declined after the first quarter of 2023. By mid to late 2024, the margin dropped to its lowest points near 10.6% and 13.35%, showing a considerable contraction in profitability relative to revenues. Towards the end of the observed period, a slight recovery is evident, with margins rising to approximately 18.1% and 19.75% by June 2025.

Asset Turnover

The asset turnover ratio remained relatively stable with minor fluctuations throughout the periods. Initial values in early 2020 were missing, but from early 2021 onward, the ratio hovered between 0.37 and 0.41 until mid-2022. A marked decline to roughly 0.28 occurred around late 2022 and persisted through early 2024, indicating reduced efficiency in generating revenue from assets. Subsequently, a gradual improvement is observed, with the ratio increasing back towards 0.38 by mid-2025, reflecting a potential enhancement in asset utilization.

Financial Leverage

The financial leverage ratio exhibited substantial volatility and overall a decreasing trend from extremely high levels. Initially, leverage ranged between approximately 5.9 and 9.13 through 2020 and 2021. There was a conspicuous spike to an abnormally high level of 64.62 in early 2022, followed by a sharp decline over the following quarters. The ratio stabilized somewhat in the mid-teens for several quarters and then gradually decreased further to around 11.83 by mid-2025. This indicates a reduction in the dependence on debt financing or the amount of assets financed by equity over time.

Return on Equity (ROE)

ROE displayed extreme volatility with dramatic spikes and contractions. The data begins with values in the 60%-77% range in 2020 but jumped significantly to 624.78% in early 2022, coinciding with the spike in financial leverage. After this peak, ROE sharply fell yet remained elevated with values consistently above 50% through mid-2024. Towards the end of the period, a noticeable increase is observed again, reaching near 95.59% before a slight decline to 89.11%. This erratic behavior suggests the influence of extraordinary factors affecting profitability and equity efficiency, possibly linked to changes in leverage and net profit margin dynamics.

Overall, the data indicates a period marked by significant financial fluctuations, particularly in leverage and returns to equity, which may warrant further investigation into underlying operational or structural changes. The decline and subsequent gradual recovery in asset turnover and net profit margin also reflect shifting efficiency and profitability challenges faced during the timeframe analyzed.

The analysis of the quarterly financial data reveals several key trends and fluctuations over the reviewed periods.

Tax Burden

The tax burden ratio remains relatively stable throughout the periods, consistently hovering around 0.86 to 0.90. This stability indicates a steady effective tax rate, with minimal variation in the proportion of earnings paid as taxes.

Interest Burden

The interest burden shows a moderate declining trend over time, starting around 0.87 and decreasing gradually to as low as 0.52 before recovering to about 0.69-0.72 in the latest quarters. The decline suggests increasing interest expenses or financial costs relative to earnings before interest and taxes, with some rebound toward the end of the timeline.

EBIT Margin

The EBIT margin displays variability but generally remains strong, ranging mostly between approximately 30% to 45%. There is a notable peak around the middle of the timeline, with margins exceeding 43%, followed by a pronounced dip reaching the low 20%s towards the later periods. The margin improves modestly again at the very end, indicating fluctuations in operating profitability.

Asset Turnover

Asset turnover remains relatively stable, fluctuating mostly between 0.28 and 0.41. Initially, the ratio exhibits minor variation but experiences a decrease to the lower range around 0.28 for several quarters before recovering toward 0.38 near the conclusion of the data. This pattern suggests periods of less efficient asset utilization followed by improvements in generating revenue from assets.

Financial Leverage

Financial leverage exhibits significant volatility with an exceptionally high spike reaching over 64 at one point, followed by a steep decline and fluctuating levels thereafter. The earlier periods maintained moderate leverage between 5.9 and 9.13, but the appearance of very high leverage indicates considerable changes in the debt structure or equity base during that quarter. Subsequent quarters show leverage scaling down but still remaining elevated relative to earlier figures, implying ongoing changes in capital structure and potential financial risk.

Return on Equity (ROE)

ROE trends align closely with fluctuations in financial leverage, reaching extraordinarily high levels, peaking at over 600%, and then declining to more moderate yet still elevated figures between 50% and 95%. This extreme variation suggests that the spikes in ROE are significantly influenced by leverage effects rather than purely operational profitability. The decline and subsequent stabilization at high but reduced levels may indicate that the company is managing its equity returns amid capital and operational changes.

In summary, the company demonstrates stable tax efficiency and considerable fluctuations in interest burden, operating margins, asset turnover, and leverage. The extreme volatility in financial leverage and ROE points to periods of substantial financial restructuring or shifts in capital composition, which have materially affected performance metrics. Operating profitability and asset utilization showed resilience but accommodated some stress in certain quarters. Overall, the data reflects a dynamic financial environment with both risk and opportunity elements present throughout the observed timeframe.

Net Profit Margin

The net profit margin displayed a generally strong performance starting from the first recorded period in March 2021, with values near 30%. Following this initial peak, a gradual decline is observed through 2022, with figures stabilizing between 23% and 27%. This trend was briefly reversed in early 2023 where margins rose above 30%, indicating improved profitability. However, from the second quarter of 2023 onwards, a marked decline occurred, reaching a low near 10.6% in mid-2024. The margin showed some recovery toward the end of 2024 and early 2025, rising again to approximately 19.75%. Overall, the net profit margin experienced fluctuations with a downward trend in the latter periods, suggesting potential pressure on profitability or increased costs.

Asset Turnover

The asset turnover ratio began at around 0.39 in early 2021, indicating moderate efficiency in utilizing assets to generate revenue. This ratio experienced slight fluctuations throughout 2021 and 2022, peaking at 0.41 and dipping to about 0.28 during early 2023. The sustained lower levels in 2023 suggest a temporary reduction in asset utilization efficiency. From early 2024 onwards, asset turnover improved steadily, increasing from 0.28 to 0.38 by mid-2025. This upward trajectory indicates a recovery in the company’s effectiveness in generating sales from its asset base over the most recent periods.

Return on Assets (ROA)

Return on assets mirrored the trends of net profit margin and asset turnover to an extent, starting near 11.5% in early 2021 and then exhibiting a gradual decline throughout 2021 and into 2022. ROA dipped below 9% in late 2022 and further decreased in 2023, reaching lows around 4%. The most significant decline occurred in early to mid-2024 when ROA fell to approximately 3.44%. Following this period, ROA showed signs of improvement, climbing to 7.53% by mid-2025. The decline followed by recovery in ROA points to fluctuating profitability in relation to the company’s asset base, potentially driven by both net margin changes and asset usage efficiency.

Overall trends and insights

Across the analyzed periods, the company exhibited a pattern of initial strong profitability and asset efficiency, followed by a downturn starting in late 2022 through mid-2024. Profitability metrics such as net profit margin and return on assets were notably impacted, with their reductions suggesting pressures on earnings or operational challenges. Conversely, asset turnover showed a delayed but clear recovery beginning in early 2024, indicating enhanced asset utilization. The subsequent improvement in both ROA and net margin towards mid-2025 suggests the potential onset of a financial performance recovery.

The quarterly financial data reveal several notable trends in key performance metrics over the observed periods.

Tax Burden Ratio

The tax burden ratio remained relatively stable from the first available data point onwards, fluctuating within a narrow range between 0.86 and 0.90. This consistency suggests steady effective tax rates relative to pre-tax earnings.

Interest Burden Ratio

The interest burden ratio showed a gradual decline from around 0.87 to a low of approximately 0.52 during the mid-to-late quarters, indicating an increasing interest expense relative to earnings before interest and taxes over that timeframe. However, a partial recovery is observable towards the end of the period, with ratios rising back to around 0.69 to 0.72.

EBIT Margin (%)

EBIT margins experienced considerable volatility. Initial readings ranged from about 31% to 38%, followed by a peak reaching above 44%. After this peak, margins generally declined to below 27%, before a modest uptick returning margins to roughly 25% to 30% in the later periods. This pattern indicates fluctuating operating profitability with periods of both expansion and contraction over the observed timeframe.

Asset Turnover Ratio

This ratio illustrated minor fluctuations, typically oscillating between 0.37 and 0.41 initially. A sharp dip was noted later, falling to around 0.28 for multiple quarters, signaling decreased efficiency in generating revenue from assets during that phase. Subsequently, a steady recovery trend is visible, climbing back up to approximately 0.38 by the latest periods.

Return on Assets (ROA) (%)

Return on assets exhibited a declining trend from roughly 11.5% down to near 3.4% at its lowest point, consistent with the earlier declines in EBIT margin and asset turnover. After this trough, ROA showed signs of improvement, increasing back to about 7.5% towards the end of the timeline. These movements reflect the combined effects of fluctuating profitability and asset utilization efficiency.

Overall, the data indicate an environment of operational challenges marked by declining interest burden coverage and dips in operating margins and asset efficiency, followed by signs of recovery in the most recent quarters. The steady tax burden ratio suggests consistent taxation impact through these periods.

Tax Burden

The tax burden ratio remains relatively stable over the reported quarters, consistently ranging between 0.86 and 0.90, with minor fluctuations. This indicates a steady tax impact on earnings before taxes, with no significant shifts that would suggest changes in tax policy or extraordinary events impacting tax expense.

Interest Burden

The interest burden displays a downward trend beginning in early 2023, decreasing from approximately 0.85 to a low of 0.52 by mid-2024, which signifies increased interest expenses relative to EBIT during this time. However, from mid-2024 onward, there is a noticeable recovery in the interest burden ratio, rising back up to around 0.72 by mid-2025. This pattern suggests a period of higher leverage or increased financing costs, followed by an improvement in interest efficiency or reduction in interest expenses.

EBIT Margin

The EBIT margin shows significant variability over the periods analyzed. From 2020 through 2022, the margin hovers around the lower 30% to high-30% range, with a peak at approximately 44.5% in the first half of 2023. Post peak, there is a sharp decline starting in late 2023, dropping to around 22.8% in third quarter of 2024, before showing signs of recovery to nearly 31% by mid-2025. This volatility reflects fluctuations in operating profitability, potentially driven by changes in sales, cost structure, or other operational factors.

Net Profit Margin

The net profit margin closely mirrors the trend of the EBIT margin but generally exhibits lower values, as expected due to tax and interest impacts. It similarly peaks near 31.8% in early 2023, followed by a considerable decline to a low of approximately 10.6% by the third quarter of 2024. Following this trough, the net margin recovers to near 19.75% in mid-2025. This pattern indicates that net profitability faced considerable challenges during 2023 and 2024 but has been improving in recent quarters.

Overall Insights

The data depicts a period of strong operating and net profitability up until early 2023, followed by a phase of pressure on both margins throughout 2023 and into 2024. This coincides with a deteriorating interest burden, suggesting increased financing costs may have contributed to the compression in profitability. By mid-2024 and beyond, improvements in the interest burden ratio coincide with a recovery in both EBIT and net profit margins, pointing to a strengthening financial performance. The tax burden remaining steady throughout suggests that tax effects did not materially influence the profitability fluctuations observed.