Stock Analysis on Net
Stock Analysis on Net

Air Products & Chemicals Inc. (NYSE:APD)

This company has been moved to the archive! The financial data has not been updated since August 9, 2021.

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

Microsoft Excel

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

Two-Component Disaggregation of ROE

Air Products & Chemicals Inc., decomposition of ROE

Microsoft Excel
ROE = ROA × Financial Leverage
Sep 30, 2020 15.62% = 7.50% × 2.08
Sep 30, 2019 15.92% = 9.29% × 1.71
Sep 30, 2018 13.80% = 7.81% × 1.77
Sep 30, 2017 29.75% = 16.25% × 1.83
Sep 30, 2016 8.91% = 3.50% × 2.55
Sep 30, 2015 17.63% = 7.33% × 2.41

Based on: 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30), 10-K (reporting date: 2017-09-30), 10-K (reporting date: 2016-09-30), 10-K (reporting date: 2015-09-30).

The primary reason for the decrease in return on equity ratio (ROE) over 2020 year is the decrease in profitability measured by return on assets ratio (ROA).

Three-Component Disaggregation of ROE

Air Products & Chemicals Inc., decomposition of ROE

Microsoft Excel
ROE = Net Profit Margin × Asset Turnover × Financial Leverage
Sep 30, 2020 15.62% = 21.30% × 0.35 × 2.08
Sep 30, 2019 15.92% = 19.73% × 0.47 × 1.71
Sep 30, 2018 13.80% = 16.77% × 0.47 × 1.77
Sep 30, 2017 29.75% = 36.65% × 0.44 × 1.83
Sep 30, 2016 8.91% = 6.63% × 0.53 × 2.55
Sep 30, 2015 17.63% = 12.91% × 0.57 × 2.41

Based on: 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30), 10-K (reporting date: 2017-09-30), 10-K (reporting date: 2016-09-30), 10-K (reporting date: 2015-09-30).

The primary reason for the decrease in return on equity ratio (ROE) over 2020 year is the decrease in efficiency measured by asset turnover ratio.

Five-Component Disaggregation of ROE

Air Products & Chemicals Inc., decomposition of ROE

Microsoft Excel
ROE = Tax Burden × Interest Burden × EBIT Margin × Asset Turnover × Financial Leverage
Sep 30, 2020 15.62% = 0.80 × 0.96 × 27.94% × 0.35 × 2.08
Sep 30, 2019 15.92% = 0.79 × 0.94 × 26.65% × 0.47 × 1.71
Sep 30, 2018 13.80% = 0.74 × 0.94 × 24.10% × 0.47 × 1.77
Sep 30, 2017 29.75% = 0.92 × 0.96 × 41.31% × 0.44 × 1.83
Sep 30, 2016 8.91% = 0.52 × 0.91 × 14.00% × 0.53 × 2.55
Sep 30, 2015 17.63% = 0.75 × 0.94 × 18.16% × 0.57 × 2.41

Based on: 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30), 10-K (reporting date: 2017-09-30), 10-K (reporting date: 2016-09-30), 10-K (reporting date: 2015-09-30).

The primary reason for the decrease in return on equity ratio (ROE) over 2020 year is the decrease in efficiency measured by asset turnover ratio.

Two-Component Disaggregation of ROA

Air Products & Chemicals Inc., decomposition of ROA

Microsoft Excel
ROA = Net Profit Margin × Asset Turnover
Sep 30, 2020 7.50% = 21.30% × 0.35
Sep 30, 2019 9.29% = 19.73% × 0.47
Sep 30, 2018 7.81% = 16.77% × 0.47
Sep 30, 2017 16.25% = 36.65% × 0.44
Sep 30, 2016 3.50% = 6.63% × 0.53
Sep 30, 2015 7.33% = 12.91% × 0.57

Based on: 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30), 10-K (reporting date: 2017-09-30), 10-K (reporting date: 2016-09-30), 10-K (reporting date: 2015-09-30).

The primary reason for the decrease in return on assets ratio (ROA) over 2020 year is the decrease in asset turnover ratio.

Four-Component Disaggregation of ROA

Air Products & Chemicals Inc., decomposition of ROA

Microsoft Excel
ROA = Tax Burden × Interest Burden × EBIT Margin × Asset Turnover
Sep 30, 2020 7.50% = 0.80 × 0.96 × 27.94% × 0.35
Sep 30, 2019 9.29% = 0.79 × 0.94 × 26.65% × 0.47
Sep 30, 2018 7.81% = 0.74 × 0.94 × 24.10% × 0.47
Sep 30, 2017 16.25% = 0.92 × 0.96 × 41.31% × 0.44
Sep 30, 2016 3.50% = 0.52 × 0.91 × 14.00% × 0.53
Sep 30, 2015 7.33% = 0.75 × 0.94 × 18.16% × 0.57

Based on: 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30), 10-K (reporting date: 2017-09-30), 10-K (reporting date: 2016-09-30), 10-K (reporting date: 2015-09-30).

The primary reason for the decrease in return on assets ratio (ROA) over 2020 year is the decrease in efficiency measured by asset turnover ratio.

Disaggregation of Net Profit Margin

Air Products & Chemicals Inc., decomposition of net profit margin ratio

Microsoft Excel
Net Profit Margin = Tax Burden × Interest Burden × EBIT Margin
Sep 30, 2020 21.30% = 0.80 × 0.96 × 27.94%
Sep 30, 2019 19.73% = 0.79 × 0.94 × 26.65%
Sep 30, 2018 16.77% = 0.74 × 0.94 × 24.10%
Sep 30, 2017 36.65% = 0.92 × 0.96 × 41.31%
Sep 30, 2016 6.63% = 0.52 × 0.91 × 14.00%
Sep 30, 2015 12.91% = 0.75 × 0.94 × 18.16%

Based on: 10-K (reporting date: 2020-09-30), 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30), 10-K (reporting date: 2017-09-30), 10-K (reporting date: 2016-09-30), 10-K (reporting date: 2015-09-30).

The primary reason for the increase in net profit margin ratio over 2020 year is the increase in operating profitability measured by EBIT margin ratio.