Analysis of Profitability Ratios
Profitability ratios measure the company ability to generate profitable sales from its resources (assets).
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- Balance Sheet: Assets
- Balance Sheet: Liabilities and Stockholders’ Equity
- Cash Flow Statement
- Common-Size Income Statement
- Analysis of Solvency Ratios
- Analysis of Short-term (Operating) Activity Ratios
- Analysis of Long-term (Investment) Activity Ratios
- Net Profit Margin since 2019
- Total Asset Turnover since 2019
- Aggregate Accruals
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Profitability Ratios (Summary)
Shockwave Medical Inc., profitability ratios
Based on: 10-K (reporting date: 2023-12-31), 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).
- Gross Profit Margin
- The gross profit margin displayed a consistently increasing trend from 60.03% in 2019 to 86.94% in 2023. This indicates an improving efficiency in production or service delivery, leading to higher profitability at the gross level over the five-year period.
- Operating Profit Margin
- The operating profit margin showed significant improvement, moving from deeply negative values (-120.76% in 2019 and -96.86% in 2020) to near breakeven in 2021 (-0.37%), followed by positive margins of 25.35% in 2022 and 21.79% in 2023. This suggests a substantial turnaround in operational efficiency and cost management, enabling the company to generate operating profits after sustained losses.
- Net Profit Margin
- Net profit margin followed a similar trajectory, improving from large losses (-119.06% in 2019 and -96.92% in 2020) to a slight negative margin in 2021 (-3.85%), then surging to a notably high 44.1% in 2022 before moderating to 20.17% in 2023. The 2022 value reflects an exceptional net profitability year, possibly due to one-time gains or improved profitability that year, with a decline in 2023 indicating some normalization or increased expenses.
- Return on Equity (ROE)
- ROE followed the pattern of profitability metrics, being negative and deteriorating slightly in the early years (-26.53% in 2019 and -29.11% in 2020), then approaching zero in 2021 (-3.78%) and sharply improving to 42.24% in 2022. The subsequent decrease to 22.03% in 2023 still represents a healthy return on shareholder investment, demonstrating an overall recovery in equity returns during the period.
- Return on Assets (ROA)
- ROA mirrored ROE trends, starting negatively at -22.04% in 2019 and worsening to -24.15% in 2020. It improved to near zero in 2021 (-2.64%), surged to 33.43% in 2022, but decreased considerably to 9.4% in 2023. This suggests the company’s assets generated increasing profit over the period, especially in 2022, although asset utilization efficiency declined somewhat the following year.
Return on Sales
Return on Investment
Gross Profit Margin
Shockwave Medical Inc., gross profit margin calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Gross profit | ||||||
| Revenue | ||||||
| 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-K (reporting date: 2023-12-31), 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).
1 2023 Calculation
Gross profit margin = 100 × Gross profit ÷ Revenue
= 100 × ÷ =
2 Click competitor name to see calculations.
- Revenue
- Revenue demonstrated a strong upward trajectory over the five-year period. Starting at $42.9 million in 2019, it rose significantly each year, reaching $730.2 million by 2023. This indicates robust growth, with particularly large increases observed between 2020 and 2021, and again from 2021 through 2023.
- Gross Profit
- Gross profit followed a similar growth pattern to revenue, increasing from $25.8 million in 2019 to $634.8 million in 2023. The growth in gross profit was substantial, especially from 2020 onwards, where it more than quadrupled each year, indicating improved operational efficiency or higher margin sales during this period.
- Gross Profit Margin
- The gross profit margin showed a consistent and meaningful upward trend, rising from 60.03% in 2019 to 86.94% in 2023. This improvement hints at increased profitability per unit of revenue, possibly due to cost reductions, pricing power, or improved product mix. The margin increased steadily each year, reflecting enhanced control over cost of goods sold or more favorable pricing dynamics.
Operating Profit Margin
Shockwave Medical Inc., operating profit margin calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Income (loss) from operations | ||||||
| Revenue | ||||||
| Profitability Ratio | ||||||
| Operating profit margin1 | ||||||
| Benchmarks | ||||||
| Operating Profit Margin, Competitors2 | ||||||
| Abbott Laboratories | ||||||
| Elevance Health Inc. | ||||||
| Intuitive Surgical Inc. | ||||||
| Medtronic PLC | ||||||
| UnitedHealth Group Inc. | ||||||
| Operating Profit Margin, Sector | ||||||
| Health Care Equipment & Services | ||||||
| Operating Profit Margin, Industry | ||||||
| Health Care | ||||||
Based on: 10-K (reporting date: 2023-12-31), 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).
1 2023 Calculation
Operating profit margin = 100 × Income (loss) from operations ÷ Revenue
= 100 × ÷ =
2 Click competitor name to see calculations.
- Income (loss) from operations
- The operational income exhibited a marked improvement over the period analyzed. Starting with a substantial loss of approximately $51.8 million in 2019, the loss deepened to around $65.7 million in 2020. However, a significant turnaround occurred in 2021, where the loss narrowed considerably to $871 thousand, followed by a switch to positive operational income in 2022 and 2023, reaching $124.1 million and $159.1 million respectively. This trend indicates effective cost control or revenue growth leading to operational profitability in the latter years.
- Revenue
- Revenue increased sharply throughout the five-year period. Beginning at $42.9 million in 2019, revenue grew to $67.8 million in 2020 and then surged significantly in 2021 to $237.1 million. This upward trajectory continued with revenues reaching $489.7 million in 2022 and further expanding to $730.2 million in 2023. The consistent and substantial revenue growth suggests strong market demand and successful business expansion strategies.
- Operating profit margin
- The operating profit margin reflected the operational income trend with notable progression. The company operated at a significant negative margin of -120.76% in 2019 and a somewhat less negative margin of -96.86% in 2020. The margin nearly broke even in 2021 at -0.37%. A positive turnaround was achieved in 2022 with a 25.35% margin, followed by a slight decrease to 21.79% in 2023. These margin improvements suggest enhanced operational efficiency and profitability, although the slight margin contraction in 2023 may merit monitoring.
Net Profit Margin
Shockwave Medical Inc., net profit margin calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Net income (loss) | ||||||
| Revenue | ||||||
| Profitability Ratio | ||||||
| Net profit margin1 | ||||||
| Benchmarks | ||||||
| Net Profit Margin, Competitors2 | ||||||
| Abbott Laboratories | ||||||
| Elevance Health Inc. | ||||||
| Intuitive Surgical Inc. | ||||||
| Medtronic PLC | ||||||
| UnitedHealth Group Inc. | ||||||
| Net Profit Margin, Sector | ||||||
| Health Care Equipment & Services | ||||||
| Net Profit Margin, Industry | ||||||
| Health Care | ||||||
Based on: 10-K (reporting date: 2023-12-31), 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).
1 2023 Calculation
Net profit margin = 100 × Net income (loss) ÷ Revenue
= 100 × ÷ =
2 Click competitor name to see calculations.
- Revenue Trends
- Revenue exhibited a strong upward trajectory over the analyzed period. Starting at $42.9 million in 2019, it increased consistently each year, reaching $730.2 million by 2023. This represents a more than 17-fold growth over the five-year span, indicating substantial business expansion and sales performance improvement.
- Net Income (Loss) Trends
- Net income demonstrated a significant turnaround. The company experienced net losses from 2019 through 2021, with the largest loss of approximately $65.7 million in 2020. However, 2022 marked a dramatic shift to profitability, with net income reaching $216.0 million, followed by a strong but reduced net income of $147.3 million in 2023. This suggests effective cost management or operational improvements contributing to the company’s profitability.
- Net Profit Margin
- The net profit margin mirrored the changes in net income. The margin was deeply negative in 2019 and 2020, indicating high losses relative to revenue in those years. In 2021, the margin improved significantly but was still slightly negative at -3.85%. The company achieved a positive margin of 44.1% in 2022, which then decreased to 20.17% in 2023. This fluctuation likely reflects both the profitability gains in 2022 and a relative decrease in profitability percentage due to the large increase in revenue in 2023.
- Overall Financial Performance Insights
- The company demonstrated impressive revenue growth coupled with a successful transition from sustained losses to substantial profitability within the five-year period. Although profitability margins declined after peaking in 2022, the firm maintained positive net income in 2023, indicating continued operational strength. The data reveals a phase of scale growth and improved cost efficiency that underpins the company’s financial health.
Return on Equity (ROE)
Shockwave Medical Inc., ROE calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ 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. | ||||||
| ROE, Sector | ||||||
| Health Care Equipment & Services | ||||||
| ROE, Industry | ||||||
| Health Care | ||||||
Based on: 10-K (reporting date: 2023-12-31), 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).
1 2023 Calculation
ROE = 100 × Net income (loss) ÷ Stockholders’ equity
= 100 × ÷ =
2 Click competitor name to see calculations.
- Net Income (Loss)
- The net income displayed a significant improvement over the five-year period. Starting with a loss of $51.1 million in 2019, the negative earnings deepened to approximately $65.7 million in 2020. This was followed by a considerable reduction in the loss to about $9.1 million in 2021. The trend shifted dramatically in 2022, with the company reporting a substantial profit of approximately $216.0 million, which then decreased to $147.3 million in 2023, while remaining strongly positive.
- Stockholders’ Equity
- Stockholders’ equity consistently increased each year. Beginning at $192.7 million in 2019, the equity base expanded steadily, reaching $225.7 million in 2020 and $241.8 million in 2021. There was a marked acceleration in growth from 2021 onwards, with equity more than doubling in 2022 to $511.3 million and further increasing to $668.7 million in 2023. This reflects a strengthening capital structure and retained earnings accumulation.
- Return on Equity (ROE)
- The return on equity exhibited a negative performance in the initial three years, declining from -26.53% in 2019 to -29.11% in 2020, and then improving to -3.78% in 2021. A pronounced positive turnaround occurred in 2022 with ROE reaching 42.24%, driven by the significant net income turnaround. This positive momentum decreased to 22.03% in 2023 but still indicates solid profitability relative to the equity base.
- Summary of Trends and Insights
- Over the observed period, the company experienced a notable transition from sustained losses to substantial profitability. The escalation in net income beginning in 2021 reflects a potential operational and/or strategic shift that led to positive earnings in subsequent years. The growth in stockholders’ equity supports this improvement, evidencing enhanced financial stability and increased shareholder value. ROE trends correspond closely with the net income developments, demonstrating an improved capacity to generate returns on shareholders’ investments post-2021. Despite a decline in profitability margins in 2023 compared to 2022, the firm maintains a strong positive return, indicating continued efficient equity utilization.
Return on Assets (ROA)
Shockwave Medical Inc., ROA calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ 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. | ||||||
| ROA, Sector | ||||||
| Health Care Equipment & Services | ||||||
| ROA, Industry | ||||||
| Health Care | ||||||
Based on: 10-K (reporting date: 2023-12-31), 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).
1 2023 Calculation
ROA = 100 × Net income (loss) ÷ Total assets
= 100 × ÷ =
2 Click competitor name to see calculations.
- Net Income (Loss)
- The net income experienced a significant fluctuation over the analyzed period. Initially, the company reported substantial losses, with the loss increasing from approximately -51.1 million USD in 2019 to about -65.7 million USD in 2020. In 2021, the loss sharply decreased to around -9.1 million USD, indicating an improvement. A notable turnaround occurred in 2022, achieving a positive net income of approximately 216.0 million USD. However, in 2023, the net income declined to roughly 147.3 million USD, which, while lower than 2022, remains substantially positive compared to previous years.
- Total Assets
- The total assets increased continuously during the period of 2019 to 2023. Starting at around 231.9 million USD in 2019, assets grew steadily each year, reaching approximately 272.0 million USD in 2020, 345.7 million USD in 2021, and then more than doubling in 2022 to roughly 646.1 million USD. This growth trend accelerated dramatically by 2023, with total assets surpassing 1.56 billion USD, indicating significant asset accumulation or investment growth.
- Return on Assets (ROA)
- ROA followed a trajectory correlated with net income but shows distinct volatility. It was deeply negative in 2019 and 2020, at -22.04% and -24.15% respectively, reflecting substantial losses relative to assets. In 2021, ROA improved significantly to -2.64%, signaling a move toward profitability. A sharp positive reversal occurred in 2022 with ROA reaching 33.43%, aligning with the recorded net income profit. In 2023, ROA decreased to 9.4%, indicating a reduction in asset profitability but still maintaining a positive return position.