Analysis of Profitability Ratios
Profitability ratios measure the company ability to generate profitable sales from its resources (assets).
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- Analysis of Solvency Ratios
- Analysis of Short-term (Operating) Activity Ratios
- Analysis of Long-term (Investment) Activity Ratios
- Price to FCFE (P/FCFE)
- Net Profit Margin since 2005
- Operating Profit Margin since 2005
- Debt to Equity since 2005
- Price to Earnings (P/E) since 2005
- Analysis of Revenues
- Aggregate Accruals
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Profitability Ratios (Summary)
Roper Technologies Inc., profitability ratios
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
- Gross profit margin
- The gross profit margin exhibited a generally increasing trend over the observed period, rising from 63.17% in 2018 to 69.86% in 2022. This steady growth, with a slight acceleration after 2020, indicates improving efficiency in production or procurement processes relative to sales revenue.
- Operating profit margin
- The operating profit margin showed minor fluctuations but remained relatively stable throughout the years. Starting at 26.9% in 2018, it increased slightly to 27.92% in 2019, then dipped to 25.62% in 2021 before recovering to 28.38% in 2022. This pattern suggests some volatility in operating expenses or costs, though the margin ultimately demonstrates resilience and a positive adjustment in the final year.
- Net profit margin
- The net profit margin displayed notable variability, beginning at 18.19% in 2018, peaking sharply at 32.94% in 2019, dipping again to 17.18% in 2020, and increasing to an exceptionally high 84.6% in 2022. This spike in 2022 is unusually large compared to previous years and likely reflects extraordinary factors such as non-recurring income, tax benefits, or one-time gains that substantially improved net profitability.
- Return on equity (ROE)
- ROE trends show moderate fluctuation with a strong upward movement in the final year. The ratio rose from 12.2% in 2018 to 18.63% in 2019, declined sharply to 9.06% in 2020, and then increased to 28.34% in 2022. The substantial increase in the latest period indicates enhanced effectiveness in generating returns for shareholders, potentially driven by improved net income or more efficient equity utilization.
- Return on assets (ROA)
- ROA followed a similar pattern to ROE, with gradual decreases after an initial increase, followed by a pronounced rise in 2022. The metric moved from 6.19% in 2018 to 9.76% in 2019, then to a low of 3.95% in 2020 before surging to 16.84% in 2022. This suggests the company has significantly improved its asset utilization and overall operational efficiency in generating profits in the most recent period.
Return on Sales
Return on Investment
Gross Profit Margin
Roper Technologies Inc., gross profit margin calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Gross profit | ||||||
| Net revenues | ||||||
| Profitability Ratio | ||||||
| Gross profit margin1 | ||||||
| Benchmarks | ||||||
| Gross Profit Margin, Competitors2 | ||||||
| Apple Inc. | ||||||
| Arista Networks Inc. | ||||||
| Cisco Systems Inc. | ||||||
| Dell Technologies Inc. | ||||||
| Super Micro Computer Inc. | ||||||
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 2022 Calculation
Gross profit margin = 100 × Gross profit ÷ Net revenues
= 100 × ÷ =
2 Click competitor name to see calculations.
- Net Revenues
- Net revenues experienced a generally increasing trend from 2018 through 2021, rising from 5,191,200 thousand US dollars in 2018 to 5,777,800 thousand US dollars in 2021. However, in 2022, net revenues declined to 5,371,800 thousand US dollars, marking a reversal in the previous upward trend.
- Gross Profit
- Gross profit followed a similar upward trajectory from 2018 to 2021, increasing from 3,279,500 thousand US dollars to 3,917,400 thousand US dollars. In 2022, gross profit decreased to 3,752,800 thousand US dollars, reflecting a downturn consistent with the decline in net revenues during the same period.
- Gross Profit Margin
- The gross profit margin demonstrated a consistent improvement throughout the five-year period. Starting at 63.17% in 2018, the margin increased each year, reaching 69.86% in 2022. The year 2021 saw a notable rise to 67.8%, and the margin continued to expand in 2022 despite declines in absolute gross profit and net revenues.
- Overall Analysis
- The data indicates that while net revenues and gross profit grew steadily from 2018 through 2021, both metrics experienced a decline in 2022. Contrastingly, the gross profit margin improved steadily throughout the entire period, including the year 2022. This suggests enhanced cost efficiency or improved pricing strategies, which partially offset the impact of reduced revenues on profitability.
Operating Profit Margin
Roper Technologies Inc., operating profit margin calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Income from operations | ||||||
| Net revenues | ||||||
| Profitability Ratio | ||||||
| Operating profit margin1 | ||||||
| Benchmarks | ||||||
| Operating Profit Margin, Competitors2 | ||||||
| Apple Inc. | ||||||
| Arista Networks Inc. | ||||||
| Cisco Systems Inc. | ||||||
| Dell Technologies Inc. | ||||||
| Super Micro Computer Inc. | ||||||
| Operating Profit Margin, Sector | ||||||
| Technology Hardware & Equipment | ||||||
| Operating Profit Margin, Industry | ||||||
| Information Technology | ||||||
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 2022 Calculation
Operating profit margin = 100 × Income from operations ÷ Net revenues
= 100 × ÷ =
2 Click competitor name to see calculations.
- Income from operations
- The income from operations showed an overall upward trend from 2018 to 2022. Starting at $1,396,400 thousand in 2018, it increased steadily to $1,528,500 thousand by 2022, with a slight dip observed in 2020 when compared to 2019. This suggests consistent operational performance with minor volatility during 2020.
- Net revenues
- Net revenues increased from $5,191,200 thousand in 2018 to a peak of $5,777,800 thousand in 2021, indicating steady growth over the four-year period. However, there was a notable decline in 2022, where net revenues dropped to $5,371,800 thousand. This decrease may warrant further investigation to understand the underlying causes, such as market conditions or operational challenges.
- Operating profit margin
- The operating profit margin exhibited some fluctuations but generally remained strong throughout the period. It started at 26.9% in 2018, rose to a peak of 27.92% in 2019, then declined for two consecutive years to 25.62% in 2021 before rising again to 28.38% in 2022, the highest margin within the observed timeframe. This indicates improving efficiency or cost management in 2022 despite the drop in net revenues.
- Overall Insights
- The data reveals that the company maintained a relatively stable operational income and enhanced profit margins despite fluctuating revenue trends. The decrease in net revenues in 2022 contrasts with the highest operating profit margin in the same year, suggesting effective cost controls or higher-margin product mixes contributing to profitability. The dip in income from operations in 2020 aligns with a slight reduction in operating margin, reflecting possible impacts from external factors during that period.
Net Profit Margin
Roper Technologies Inc., net profit margin calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Net earnings | ||||||
| Net revenues | ||||||
| Profitability Ratio | ||||||
| Net profit margin1 | ||||||
| Benchmarks | ||||||
| Net Profit Margin, Competitors2 | ||||||
| Apple Inc. | ||||||
| Arista Networks Inc. | ||||||
| Cisco Systems Inc. | ||||||
| Dell Technologies Inc. | ||||||
| Super Micro Computer Inc. | ||||||
| Net Profit Margin, Sector | ||||||
| Technology Hardware & Equipment | ||||||
| Net Profit Margin, Industry | ||||||
| Information Technology | ||||||
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 2022 Calculation
Net profit margin = 100 × Net earnings ÷ Net revenues
= 100 × ÷ =
2 Click competitor name to see calculations.
- Net Earnings
- The net earnings exhibited fluctuations over the analyzed period. Starting at approximately 944.4 million USD in 2018, earnings nearly doubled in 2019 to about 1.77 billion USD. However, in 2020, there was a decline to approximately 949.7 million USD, followed by a moderate increase in 2021 to 1.15 billion USD. A significant rise was observed in 2022, with net earnings reaching approximately 4.54 billion USD, representing a substantial increase compared to all prior years.
- Net Revenues
- Net revenues showed a gradual upward trend from 2018 to 2021. Revenues grew from around 5.19 billion USD in 2018 to 5.78 billion USD in 2021, marking a consistent increase each year. However, in 2022, revenues decreased to approximately 5.37 billion USD, indicating a reversal of the prior growth trend.
- Net Profit Margin
- The net profit margin displayed notable volatility throughout the period. It began at 18.19% in 2018, surged to 32.94% in 2019, then fell sharply to 17.18% in 2020. There was a moderate recovery in 2021 to 19.95%, followed by a dramatic increase to 84.6% in 2022. This last value is exceptionally high, indicating a significant improvement in profitability relative to revenues during that year.
- Overall Observations
- While net revenues overall increased from 2018 through 2021 before declining in 2022, net earnings did not follow the same pattern, showing marked variability. The most striking observation is the disproportionate jump in net earnings and net profit margin in 2022 despite a decline in revenues. This could suggest substantial improvements in operational efficiency, cost reductions, or extraordinary items positively impacting net earnings. The variability in profit margins suggests earnings volatility and potential changes in cost structure or one-time events influencing profitability. Further investigation into the underlying causes for the sharp increase in profitability in the final year would be warranted to understand sustainability and drivers of this performance.
Return on Equity (ROE)
Roper Technologies Inc., ROE calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Net earnings | ||||||
| Stockholders’ equity | ||||||
| Profitability Ratio | ||||||
| ROE1 | ||||||
| Benchmarks | ||||||
| ROE, Competitors2 | ||||||
| Apple Inc. | ||||||
| Arista Networks Inc. | ||||||
| Cisco Systems Inc. | ||||||
| Dell Technologies Inc. | ||||||
| Super Micro Computer Inc. | ||||||
| ROE, Sector | ||||||
| Technology Hardware & Equipment | ||||||
| ROE, Industry | ||||||
| Information Technology | ||||||
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 2022 Calculation
ROE = 100 × Net earnings ÷ Stockholders’ equity
= 100 × ÷ =
2 Click competitor name to see calculations.
- Net Earnings
- Net earnings show significant fluctuations over the analyzed period. There was a substantial increase from 944,400 thousand US dollars in 2018 to 1,767,900 thousand in 2019. However, this was followed by a notable decline to 949,700 thousand in 2020. The earnings then recovered somewhat in 2021, reaching 1,152,600 thousand, before experiencing a remarkable surge in 2022, reaching 4,544,700 thousand. This pattern indicates considerable volatility, with a particularly strong performance in the final year.
- Stockholders’ Equity
- Stockholders’ equity exhibited a steady upward trend throughout the period. Starting at 7,738,500 thousand US dollars in 2018, equity increased each year, reaching 16,037,800 thousand in 2022. The growth appears consistent and robust, almost doubling over the five years, which reflects a strengthening capital base and possibly retained earnings contributing to equity growth.
- Return on Equity (ROE)
- The return on equity experienced notable variation across the period. Beginning at 12.2% in 2018, the ROE increased markedly to a peak of 18.63% in 2019. It then sharply declined to 9.06% in 2020, followed by a slight improvement to 9.97% in 2021. In 2022, there was a significant increase to 28.34%, the highest level observed. The ROE movements mirror the fluctuations in net earnings, with the elevated ROE in 2022 reflecting the substantial increase in profitability relative to the equity base that year.
Return on Assets (ROA)
Roper Technologies Inc., ROA calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Net earnings | ||||||
| Total assets | ||||||
| Profitability Ratio | ||||||
| ROA1 | ||||||
| Benchmarks | ||||||
| ROA, Competitors2 | ||||||
| Apple Inc. | ||||||
| Arista Networks Inc. | ||||||
| Cisco Systems Inc. | ||||||
| Dell Technologies Inc. | ||||||
| Super Micro Computer Inc. | ||||||
| ROA, Sector | ||||||
| Technology Hardware & Equipment | ||||||
| ROA, Industry | ||||||
| Information Technology | ||||||
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 2022 Calculation
ROA = 100 × Net earnings ÷ Total assets
= 100 × ÷ =
2 Click competitor name to see calculations.
The analysis of the annual financial data over the five-year period reveals distinct trends in profitability, asset growth, and return on assets (ROA).
- Net Earnings
- Net earnings exhibited significant fluctuations throughout the period. Beginning at 944.4 million US dollars in 2018, the figure nearly doubled to 1.7689 billion in 2019. However, this was followed by a notable decline to 949.7 million in 2020. A moderate recovery occurred in 2021 with earnings rising to 1.1526 billion, and then a substantial increase was observed in 2022 with net earnings reaching 4.547 billion.
- Total Assets
- Total assets consistently increased each year, evidencing steady growth in the company’s asset base. The assets rose from 15.25 billion US dollars in 2018 to 18.11 billion in 2019, then to 24.02 billion in 2020. A slight decrease occurred in 2021 to 23.71 billion, but the upward trend resumed sharply in 2022, reaching nearly 27 billion.
- Return on Assets (ROA)
- ROA demonstrated notable volatility across the timeframe. It improved from 6.19% in 2018 to a higher 9.76% in 2019, then declined significantly to 3.95% in 2020. A partial recovery to 4.86% was seen in 2021, followed by a strong surge to 16.84% in 2022, aligning with the sharp increase in net earnings.
Overall, the data indicates that while the company managed continuous asset growth, profitability experienced considerable variability. The pronounced increase in net earnings and ROA in 2022 suggests an improvement in operational efficiency or profitable initiatives implemented during that year. The moderate asset decrease in 2021 could be linked to external or strategic factors warranting further investigation. The ROA trend closely mirrors net earnings changes, highlighting the impact of profitability on asset utilization.