Accenture PLC (NYSE:ACN)

Return on Assets (ROA)

The Return on Assets exhibited a fluctuating trend over the observed period. Starting at 13.78% in 2020, ROA slightly decreased to 13.68% in 2021, then experienced a peak at 14.55% in 2022. After this peak, there was a steady decline reaching 11.74% by 2025. The overall trend suggests a reduction in asset profitability in the most recent years, indicating potential challenges in generating earning power from total assets.

Financial Leverage

Financial leverage demonstrated some variability but remained relatively stable within a narrow range. Beginning at a ratio of 2.18 in 2020, it slightly increased to 2.21 in 2021, then declined gradually to 1.98 in 2024 before edging up again to 2.10 in 2025. This indicates a modest adjustment in the capital structure with slight reductions in leverage during mid-period followed by a marginal increase, potentially reflecting changes in debt or equity financing strategies.

Return on Equity (ROE)

Return on Equity showed a clear declining trend over the period analyzed. The ROE started at 30.05% in 2020 and increased marginally to 30.25% in 2021, then reached its highest value at 31.11% in 2022. This was followed by a marked decrease to 26.75% in 2023 and a continued decline, reaching 24.61% in 2025. The decreasing ROE in recent years suggests diminished returns to shareholders, potentially caused by lower net income or increased equity base, which could warrant further investigation into profitability or capital management.

The financial data over the recent years reveals distinct trends in profitability, efficiency, leverage, and overall return on equity for the company.

Net Profit Margin

The net profit margin exhibited a relatively stable pattern, fluctuating modestly between approximately 10.7% and 11.7%. It started around 11.52% and showed a slight decline after 2021, reaching a low near 10.72% in 2023 before recovering marginally by 2024 and 2025. This indicates consistent profitability but with minor pressures on margin in the middle years.

Asset Turnover

Asset turnover demonstrated more variability, initially declining from 1.2 to 1.17 by 2021, followed by an increase peaking at 1.3 in 2022. Afterwards, it trended downwards steadily to 1.07 by 2025. This suggests that the company’s efficiency in generating revenue from its assets improved markedly in 2022 but then gradually declined, potentially reflecting changes in asset utilization or revenue generation capability.

Financial Leverage

Financial leverage ratios remained relatively stable, ranging from about 1.98 to 2.21 over the period. There was a slight decrease after 2021, reaching a minimum near 1.98 in 2024, indicating modest reduction in leverage, before rising somewhat again to 2.1 in 2025. This suggests a measured approach to debt usage with only minor adjustments.

Return on Equity (ROE)

Return on equity showed a clear downward trend. Initially, ROE was robust, exceeding 30% from 2020 through 2022, peaking at 31.11%. Subsequently, it dropped significantly to around 26.75% in 2023 and continued declining through 2025 to approximately 24.61%. This decline in ROE might be attributed to the combined effects of reduced asset turnover and net profit margin stability, alongside slight leverage changes.

Overall, the company maintained consistent profitability with stable net margins but faced declining efficiency in asset utilization and a notable reduction in the return generated on shareholders' equity. The leverage position remained moderately stable, suggesting cautious financial management despite declining ROE.

Tax Burden

The tax burden ratio remained stable over the period, consistently at approximately 0.76 to 0.77. This indicates a consistent effective tax rate and minimal fluctuations in tax expenses relative to earnings before tax.

Interest Burden

The interest burden ratio exhibited slight variation, starting at 1.00 and gradually decreasing to 0.98 by the last period. This suggests a marginal increase in interest expenses relative to earnings before interest and taxes, but overall interest costs remained stable and low.

EBIT Margin

The EBIT margin showed a modest downward trend from 15.18% to a low of 14.12% around the middle periods, followed by a modest recovery to 14.85% by the end of the analyzed timeframe. This indicates a mild compression in operating profitability mid-period, with some improvement in the latest year.

Asset Turnover

Asset turnover fluctuated notably, rising from 1.20, peaking at 1.30, and then declining to 1.07 by the final period. This pattern reflects initial improvement in the efficiency with which assets generate sales, followed by a decreasing efficiency in the most recent years.

Financial Leverage

Financial leverage ratios remained relatively stable, with a slight decline from 2.18 to below 2.00 before increasing again towards 2.10 in the final period. This indicates modest changes in the company's use of debt relative to equity, with a temporary reduction in leverage before a slight increase.

Return on Equity (ROE)

ROE exhibited a peak around 31.11%, followed by a continuous decline to 24.61% in the last period. The decrease in ROE reflects reduced overall profitability and efficiency in generating returns for shareholders, despite relatively stable margins and leverage, largely influenced by asset turnover trends and operating performance.

Net Profit Margin

The net profit margin exhibited a relatively stable pattern over the observed period, fluctuating within a narrow range around 11%. It reached a peak of 11.69% in 2021, then experienced a slight decline to 10.72% by 2023. Subsequently, there was a modest recovery to 11.19% in 2024 before a minor decrease again in 2025 to 11.02%. These changes suggest consistent profitability with minor volatility but no significant upward or downward trend.

Asset Turnover

Asset turnover demonstrated some variability over the years, beginning at 1.20 in 2020, decreasing slightly to 1.17 in 2021, and then improving to a peak of 1.30 in 2022. Afterward, it declined progressively to 1.25 in 2023, 1.16 in 2024, and further down to 1.07 in 2025. This downward trend from the 2022 peak indicates a decreasing efficiency in generating revenue from assets in the most recent periods.

Return on Assets (ROA)

Return on assets showed a similar pattern to asset turnover with initial growth followed by decline. From 13.78% in 2020, ROA slightly dipped to 13.68% in 2021, then reached its highest point at 14.55% in 2022. After this peak, it declined consistently to 13.41% in 2023, then 12.99% in 2024, and further to 11.74% in 2025. This trend suggests a reduction in the overall profitability relative to assets after 2022, possibly reflecting diminishing operational efficiency or increased costs.

Tax Burden

The tax burden ratio has remained relatively stable over the periods, fluctuating only slightly between 0.76 and 0.77. This consistency indicates steady tax expense management relative to pre-tax earnings.

Interest Burden

The interest burden ratio shows a marginal decline from 1.00 to 0.98 over the analyzed years, suggesting a slight increase in interest expenses or financial costs impacting earnings before interest and taxes.

EBIT Margin

The EBIT margin demonstrates some variation, with an initial increase from 15.18% to 15.31% between 2020 and 2021, followed by a gradual decline to 14.12% in 2023, and a partial recovery to approximately 14.8% by 2025. These fluctuations reflect moderate changes in operating profitability.

Asset Turnover

The asset turnover ratio exhibits variability, starting at 1.20, dipping to 1.17 in 2021, then rising to a peak of 1.30 in 2022 before decreasing steadily to 1.07 in 2025. This trend indicates a fluctuating efficiency in utilizing assets to generate revenue, with a notable reduction in asset utilization efficiency in the later years.

Return on Assets (ROA)

Return on assets peaked at 14.55% in 2022, following a slight drop to 13.68% in the previous year. Thereafter, ROA declined progressively to 11.74% by 2025. This downward trajectory suggests diminishing overall profitability relative to the asset base in recent periods.

The financial data reveals several notable trends over the observed periods regarding profitability and burden ratios.

Tax Burden

The tax burden ratio remains relatively stable, fluctuating minimally around 0.76 to 0.77. This consistency indicates a steady effective tax rate impacting the company's earnings after tax each year.

Interest Burden

The interest burden ratio is close to 1 throughout the periods, slightly decreasing from 1 to 0.98 towards the later years. This suggests that the company's earnings before interest and taxes are only marginally affected by interest expenses, indicating low or stable interest costs relative to operating income.

EBIT Margin

The EBIT margin shows a modest decline from 15.18% in 2020 to a low of 14.12% in 2023, followed by a slight recovery to around 14.8% by 2025. This trend reflects some pressure on operating profitability in the mid-period, with partial improvement in more recent years.

Net Profit Margin

The net profit margin closely mirrors the EBIT margin trends but at lower absolute values, indicating the impact of taxes and interest expenses. It decreases from 11.52% in 2020 to 10.72% in 2023, then rises modestly to just above 11% in 2024 and 2025. This pattern suggests consistent overall profitability with mild fluctuations over the years.

Overall, the company maintains relatively stable tax and interest burdens, with slight downward pressure on profitability margins in the middle years followed by moderate recovery, reflecting resilience in profit-generating capability amid changing conditions.