Regeneron Pharmaceuticals Inc. (NASDAQ:REGN)

Return on Assets (ROA)

The Return on Assets shows a clear upward trend starting from the first available data point in March 2021, reaching a peak of 31.75% in March 2022. After this peak, the ROA declines steadily through the end of 2023, falling to approximately 11.95% in the fourth quarter of 2023. From 2024 onwards, the ROA stabilizes, fluctuating modestly between around 11.22% and 12.43%. This indicates an initial period of strong asset profitability followed by a notable decrease and subsequent stabilization at a lower level.

Financial Leverage

The financial leverage ratio exhibits a gradual downward trend beginning at 1.59 in the second quarter of 2020, decreasing steadily to its lowest point around 1.27-1.28 from early 2023 through the first quarter of 2025. The reduction in financial leverage suggests a consistent decrease in dependency on debt financing over the analyzed period, reflecting a more conservative capital structure.

Return on Equity (ROE)

The Return on Equity rises sharply from its initial recorded value of 31.86% in March 2021 to a peak of 43.03% in March 2022, mirroring the trend observed in ROA. Following this peak, ROE experiences a significant decline through 2023, dropping to approximately 15.22% by the last quarter of 2023. From 2024 onward, the ROE demonstrates relative stability within a narrow range of approximately 14.29% to 17.90%. This pattern indicates a phase of enhanced equity profitability, succeeded by a reduction and stabilization at a more moderate level, consistent with the shifts in ROA and financial leverage.

Net Profit Margin

The net profit margin shows a significant increase beginning in the first quarter of 2021, reaching a peak around the fourth quarter of 2021 at approximately 51.65%. Following this peak, there is a noticeable downward trend extending through 2024, with figures declining to around 29-33%. A slight recovery is seen towards the end of the series, with the margin increasing marginally to near 32% by the first quarter of 2025.

Asset Turnover

Asset turnover experiences moderate fluctuations over the observed period. Starting at 0.5 in March 2021, it rises steadily to a high of 0.63 during the first half of 2022. Subsequently, the ratio declines gradually through 2023 and into 2024, stabilizing in the range of 0.37 to 0.4 during the final quarters. This indicates a reduction in the efficiency of asset utilization to generate sales over time after mid-2022.

Financial Leverage

Financial leverage exhibits an overall declining trend from early 2020, starting at 1.3 and increasing slightly to around 1.59 in mid-2020. Thereafter, the ratio decreases and stabilizes between 1.27 and 1.3 from early 2022 through to the first quarter of 2025, suggesting a modest reduction in reliance on debt financing relative to equity over the longer term.

Return on Equity (ROE)

Return on equity shows a rising trend from early 2021, peaking in the third quarter of 2021 at approximately 41%. Post-peak, it declines sharply through 2022 and 2023, reaching a low in the first quarter of 2024 around 14%. There is a slight upward correction toward the end of the period, closing near 15% by the first quarter of 2025. This pattern suggests a substantial reduction in profitability relative to shareholders' equity following the peak in 2021.

The analysis of the available financial ratios over multiple quarterly periods reveals several notable trends and patterns.

Tax Burden

The Tax Burden ratio remains relatively stable from the first recorded value in March 2021 through March 2025, fluctuating narrowly between approximately 0.86 and 0.95. The ratio appears to have a slight upward trend towards the later periods, reaching a peak of 0.95 in June 2024 before settling around 0.90 by March 2025. This stability suggests consistent effective tax rates impacting the company's profitability across these quarters.

Interest Burden

The Interest Burden ratio maintains remarkable stability, consistently hovering around 0.98 to 0.99 throughout all available quarters. This indicates that interest expenses have a minimal and steady impact on the company's earnings before tax, reflecting stable financing costs or efficient interest management over time.

EBIT Margin

The EBIT Margin exhibits significant variability. Starting at approximately 45.51% in March 2021, it peaks around 59.85% in December 2020 and again maintains a high level near 58.38% in March 2022. However, following this peak, there is a discernible downward trend, with margins decreasing progressively to around 31.4% by June 2024. A moderate recovery is observed towards the end of the span, with margins rebounding to approximately 35.72% by March 2025. Overall, this pattern suggests periods of strong operational profitability followed by a decline and partial recovery, reflecting changing operational efficiencies or market conditions.

Asset Turnover

The Asset Turnover ratio shows initial growth from 0.50 in March 2021 to a peak of 0.63 around March and June 2022, signaling improved asset utilization during this period. Subsequently, there is a gradual decline to around 0.37 by late 2024, with a slight stabilization near 0.38 towards the end of the dataset. This indicates a diminishing rate of revenue generation from assets after mid-2022, potentially signaling increased asset base or lower revenue growth relative to assets.

Financial Leverage

The Financial Leverage ratio displays a mild declining trend from 1.59 in March and June 2020 to about 1.27-1.29 in the more recent quarters. This slight decrease suggests a reduction in the reliance on debt or an increase in equity base over time, contributing to a marginally lower financial risk profile.

Return on Equity (ROE)

ROE demonstrates pronounced fluctuations during the analyzed span. It initially rises sharply from around 31.86% in March 2021 to a peak of approximately 43.03% in March 2022. Beyond this peak, a consistent downward trend follows, reaching a low near 14.29% in June 2024. The ratio then exhibits a mild rebound to around 15.31% by March 2025. This trend indicates that while the company once delivered very strong returns on shareholders' equity, profitability efficiency diminished considerably in the later periods, with only a slight improvement towards the end.

In summary, the company shows stable tax and interest expense profiles with some variability in operational efficiency and asset utilization ratios. Profitability metrics such as EBIT Margin and ROE peaked around early 2022 but have since declined, which may suggest challenges in sustaining operational performance or changes in cost structure. Financial leverage appears to have decreased modestly, indicative of more conservative capital structuring. The overall picture highlights a company with solid but somewhat declining efficiency and return metrics over the most recent quarters analyzed.

Net Profit Margin

The net profit margin exhibits a significant increase during the periods starting in March 2021 through December 2021, peaking above 50%. After this peak, the margin demonstrates a general downward trend, declining gradually to around 30% by March 2024. Small fluctuations are observed thereafter, with the margin stabilizing slightly above 30% towards the end of the analyzed timeframe.

Asset Turnover

Asset turnover shows an increasing trend from March 2021 through the first half of 2022, reaching a high of approximately 0.63. Following this period, a steady decline is observed, with the ratio decreasing to about 0.37–0.38 by the end of the data set in March 2025. The decrease suggests reduced efficiency in asset utilization over the later periods.

Return on Assets (ROA)

Return on assets improves notably from March 2021 through December 2021, achieving a peak close to 32%. Subsequently, ROA experiences a marked decrease, dropping significantly by the end of 2022 and stabilizing in the low double digits around 11-12% throughout 2023 and into 2025. This decline parallels the trends seen in both net profit margin and asset turnover, indicating a potential decrease in overall profitability relative to assets.

General Observations

The initial growth phase from early 2021 to late 2021 is characterized by improvements in profitability and efficiency metrics. However, from 2022 onward, all three key indicators exhibit downward trends or stabilization at lower levels, pointing towards potential challenges in maintaining high profitability and asset efficiency. The patterns suggest that while the company achieved strong financial performance in the earlier period, later quarters indicate moderated returns and efficiency.

Tax Burden

The tax burden ratio shows a consistent level of approximately 0.86 to 0.95 throughout the observed periods from March 2021 to March 2025. It began near 0.92 in early 2021, maintained a relatively stable range mostly between 0.87 and 0.91 for several quarters, and then gradually increased to a peak of 0.95 around the fourth quarter of 2023. The ratio then somewhat declined to around 0.90 by the first quarter of 2025. This stability suggests consistent tax impact on earnings over time without major fluctuations.

Interest Burden

The interest burden ratio remained very stable throughout the period, hovering close to 0.99 with only minor declines to 0.98 during some mid-period quarters in 2023 and 2024. This indicates that interest expenses relative to earnings before interest and taxes were minimal and did not significantly affect profitability across the quarters.

EBIT Margin

The EBIT margin displayed notable volatility over the period. Starting around 45.51% in the first quarter of 2021, it rose steadily to a peak near 59.85% by the end of 2020. However, beginning in late 2021, margins began to decline sharply, falling below 35% by the end of 2023. Some recovery is observed in 2024, with margins rising back towards 36%, but overall the margin trend depicts a downward trajectory after a strong peak in 2020. This decline may indicate increasing costs or reduced pricing power impacting operating profitability.

Asset Turnover

Asset turnover ratios reveal a decreasing trend over the observed periods. Initially, the ratio was around 0.50 to 0.58 during 2020 and 2021, indicating relatively efficient use of assets to generate sales. However, from mid-2021 onward, the ratio consistently declined, reaching approximately 0.37 to 0.38 by early 2025. This suggests a gradual reduction in asset utilization efficiency, potentially linked to increased asset base relative to sales or declining revenue generation from existing assets.

Return on Assets (ROA)

Return on assets first experienced growth through 2020 and early 2021, rising from about 20.47% to a peak near 31.75% in early 2022, demonstrating improved overall profitability relative to asset base. Subsequently, ROA declined considerably, dropping to approximately 11.95% to 12.43% by 2024 and 2025. This downward trend aligns with the decreasing EBIT margin and asset turnover, signifying a reduction in the company’s ability to generate profit from its assets during the latter periods.

Tax Burden

The tax burden ratio began to be recorded starting in the quarter ending March 31, 2021, showing a value of 0.92 and trending slightly downward to 0.86 by September 30, 2021. From that point, it fluctuated modestly between approximately 0.87 and 0.90 through early 2023. Thereafter, a gradual upward movement is observable, reaching 0.95 by December 31, 2023, before stabilizing around 0.94 and declining marginally to 0.90 by March 31, 2025. Overall, the tax burden ratio has remained relatively stable with a small range near the high 0.80s to mid-0.90s, indicating consistent effective tax rates over the observed period.

Interest Burden

The interest burden ratio was first recorded in the quarter ending March 31, 2021, maintaining a mostly steady level near 0.99 throughout the entire observed period. Minor deviations to 0.98 occurred briefly in the quarters ending December 31, 2023, March 31, 2024, and June 30, 2024, but the ratio promptly returned to 0.99 by subsequent quarters. This stability indicates a consistent interest expense relative to earnings before interest and taxes, reflecting a stable cost of debt or financing expenses over time.

EBIT Margin

The EBIT margin started at 45.51% in the quarter ending March 31, 2021, with an upward trend to a peak of 59.85% by December 31, 2020 - noting the data appeared somewhat out of chronological order here. From the peak, a declining trend ensued, dropping to 44.98% by September 30, 2022, and continuing down to 33.97% by December 31, 2023. Early 2024 showed a further dip to 31.40%, followed by some recovery to 36.34% by September 30, 2024 before closing at 35.72% by March 31, 2025. This pattern suggests a period of strong operational profitability early on followed by a notable contraction, with partial recovery attempts later.

Net Profit Margin

Net profit margin data commences at 41.35% in March 31, 2021, showing an initial rise to a peak of 51.65% by December 31, 2020, again reflecting a potential data sequence issue. Subsequently, a consistent downward trajectory follows, with the margin declining to 39.97% by September 30, 2022, and continuing to fall steadily to 30.47% by December 31, 2023. The margin further decreases to a low near 29.45% by June 30, 2024, then recovers moderately to 33.61% by September 30, 2024, before settling at 31.94% by March 31, 2025. These trends mirror those seen in EBIT margin, reflecting pressures on profitability after the initial period of peak margins.