Stock Analysis on Net
Stock Analysis on Net
Microsoft Excel LibreOffice Calc

Booking Holdings Inc. (NASDAQ:BKNG)

DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin

Beginner level

Decomposing ROE involves expressing net income divided by shareholders’ equity as the product of component ratios.

Two-Component Disaggregation of ROE

Booking Holdings Inc., decomposition of ROE

Microsoft Excel LibreOffice Calc
ROE = ROA × Financial Leverage
Dec 31, 2019 82.00% = 22.73% × 3.61
Dec 31, 2018 45.51% = 17.62% × 2.58
Dec 31, 2017 20.79% = 9.20% × 2.26
Dec 31, 2016 21.74% = 10.76% × 2.02
Dec 31, 2015 29.01% = 14.65% × 1.98

Based on: 10-K (filing date: 2020-02-26), 10-K (filing date: 2019-02-27), 10-K (filing date: 2018-02-27), 10-K (filing date: 2017-02-27), 10-K (filing date: 2016-02-17).

The primary reason for the increase in return on equity ratio (ROE) over 2019 year is the increase in financial leverage ratio.

Three-Component Disaggregation of ROE

Booking Holdings Inc., decomposition of ROE

Microsoft Excel LibreOffice Calc
ROE = Net Profit Margin × Asset Turnover × Financial Leverage
Dec 31, 2019 82.00% = 32.29% × 0.70 × 3.61
Dec 31, 2018 45.51% = 27.52% × 0.64 × 2.58
Dec 31, 2017 20.79% = 18.46% × 0.50 × 2.26
Dec 31, 2016 21.74% = 19.87% × 0.54 × 2.02
Dec 31, 2015 29.01% = 27.66% × 0.53 × 1.98

Based on: 10-K (filing date: 2020-02-26), 10-K (filing date: 2019-02-27), 10-K (filing date: 2018-02-27), 10-K (filing date: 2017-02-27), 10-K (filing date: 2016-02-17).

The primary reason for the increase in return on equity ratio (ROE) over 2019 year is the increase in financial leverage ratio.

Five-Component Disaggregation of ROE

Booking Holdings Inc., decomposition of ROE

Microsoft Excel LibreOffice Calc
ROE = Tax Burden × Interest Burden × EBIT Margin × Asset Turnover × Financial Leverage
Dec 31, 2019 82.00% = 0.82 × 0.96 × 41.31% × 0.70 × 3.61
Dec 31, 2018 45.51% = 0.83 × 0.95 × 35.13% × 0.64 × 2.58
Dec 31, 2017 20.79% = 0.53 × 0.95 × 36.69% × 0.50 × 2.26
Dec 31, 2016 21.74% = 0.79 × 0.93 × 27.19% × 0.54 × 2.02
Dec 31, 2015 29.01% = 0.82 × 0.95 × 35.65% × 0.53 × 1.98

Based on: 10-K (filing date: 2020-02-26), 10-K (filing date: 2019-02-27), 10-K (filing date: 2018-02-27), 10-K (filing date: 2017-02-27), 10-K (filing date: 2016-02-17).

The primary reason for the increase in return on equity ratio (ROE) over 2019 year is the increase in financial leverage ratio.

Two-Component Disaggregation of ROA

Booking Holdings Inc., decomposition of ROA

Microsoft Excel LibreOffice Calc
ROA = Net Profit Margin × Asset Turnover
Dec 31, 2019 22.73% = 32.29% × 0.70
Dec 31, 2018 17.62% = 27.52% × 0.64
Dec 31, 2017 9.20% = 18.46% × 0.50
Dec 31, 2016 10.76% = 19.87% × 0.54
Dec 31, 2015 14.65% = 27.66% × 0.53

Based on: 10-K (filing date: 2020-02-26), 10-K (filing date: 2019-02-27), 10-K (filing date: 2018-02-27), 10-K (filing date: 2017-02-27), 10-K (filing date: 2016-02-17).

The primary reason for the increase in return on assets ratio (ROA) over 2019 year is the increase in profitability measured by net profit margin ratio.

Four-Component Disaggregation of ROA

Booking Holdings Inc., decomposition of ROA

Microsoft Excel LibreOffice Calc
ROA = Tax Burden × Interest Burden × EBIT Margin × Asset Turnover
Dec 31, 2019 22.73% = 0.82 × 0.96 × 41.31% × 0.70
Dec 31, 2018 17.62% = 0.83 × 0.95 × 35.13% × 0.64
Dec 31, 2017 9.20% = 0.53 × 0.95 × 36.69% × 0.50
Dec 31, 2016 10.76% = 0.79 × 0.93 × 27.19% × 0.54
Dec 31, 2015 14.65% = 0.82 × 0.95 × 35.65% × 0.53

Based on: 10-K (filing date: 2020-02-26), 10-K (filing date: 2019-02-27), 10-K (filing date: 2018-02-27), 10-K (filing date: 2017-02-27), 10-K (filing date: 2016-02-17).

The primary reason for the increase in return on assets ratio (ROA) over 2019 year is the increase in operating profitability measured by EBIT margin ratio.

Disaggregation of Net Profit Margin

Booking Holdings Inc., decomposition of net profit margin ratio

Microsoft Excel LibreOffice Calc
Net Profit Margin = Tax Burden × Interest Burden × EBIT Margin
Dec 31, 2019 32.29% = 0.82 × 0.96 × 41.31%
Dec 31, 2018 27.52% = 0.83 × 0.95 × 35.13%
Dec 31, 2017 18.46% = 0.53 × 0.95 × 36.69%
Dec 31, 2016 19.87% = 0.79 × 0.93 × 27.19%
Dec 31, 2015 27.66% = 0.82 × 0.95 × 35.65%

Based on: 10-K (filing date: 2020-02-26), 10-K (filing date: 2019-02-27), 10-K (filing date: 2018-02-27), 10-K (filing date: 2017-02-27), 10-K (filing date: 2016-02-17).

The primary reason for the increase in net profit margin ratio over 2019 year is the increase in operating profitability measured by EBIT margin ratio.