Analysis of Profitability Ratios
Profitability ratios measure the company ability to generate profitable sales from its resources (assets).
Profitability Ratios (Summary)
Becton, Dickinson & Co., profitability ratios
Based on: 10-K (reporting date: 2021-09-30), 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).
The financial performance over the analyzed periods demonstrates several notable trends in profitability and returns for the company.
- Gross Profit Margin
- This metric shows some fluctuation but remains relatively stable around the mid-40s percentage range. The highest value occurred in 2017 at 49.14%, while the lowest was 44.27% in 2020. Despite a dip in 2018 and 2020, there was a recovery in 2021 to 46.56%, indicating a generally consistent ability to generate gross profit relative to revenue.
- Operating Profit Margin
- The operating profit margin experienced more variation than the gross margin. It increased from 11.46% in 2016 to a peak of 12.22% in 2017 but then declined significantly to 9.37% in 2018. After some modest recovery in 2019 and a drop in 2020, it surged notably to 13.82% in 2021, the highest figure in the analyzed timeframe. This recovery suggests improvements in operational efficiency or cost management in the most recent year.
- Net Profit Margin
- The net profit margin exhibited considerable volatility. After rising from 7.82% in 2016 to a peak of 9.1% in 2017, it sharply declined to only 1.95% in 2018. Following partial recovery to 7.13% in 2019, the margin dropped again to 5.11% in 2020 before rebounding strongly to 10.33% in 2021. The low point in 2018 reflects a significant decline in profitability after expenses, while the strong rebound in 2021 indicates improved bottom-line performance.
- Return on Equity (ROE)
- ROE showed a downward trend from 12.79% in 2016 to a low of 1.48% in 2018, highlighting a period of reduced effectiveness in generating returns on shareholder equity. Although there was improvement to 5.85% in 2019, the metric declined again in 2020 before rising to 8.84% in 2021. Despite the partial recovery, ROE in 2021 remains below the early-year peak, suggesting ongoing challenges or restructuring efforts.
- Return on Assets (ROA)
- ROA mirrored the trend in ROE but with generally lower magnitude. It decreased from 3.81% in 2016 to a low of 0.58% in 2018, indicating reduced effectiveness in asset utilization. The metric showed gradual recovery in 2019 and 2021, reaching 3.88%, slightly exceeding the initial value in 2016. The low point in 2018 and subsequent recovery suggests efforts to improve asset productivity have been somewhat successful.
Overall, the data reveal a difficult period in 2018 marked by significant declines across most profitability and return indicators. Since then, there has been a mixed but generally positive trend toward recovery, culminating in improved margins and returns in 2021. The significant rebound in net profit margin and operating margin in 2021 is particularly notable, signaling enhanced profitability and operational efficiency. However, returns on equity and assets, while improved, still remain below their initial levels, indicating areas that may require continued focus for sustained financial performance.
Return on Sales
Return on Investment
Gross Profit Margin
Becton, Dickinson & Co., gross profit margin calculation, comparison to benchmarks
| Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | Sep 30, 2018 | Sep 30, 2017 | Sep 30, 2016 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Gross profit | 9,427) | 7,577) | 8,288) | 7,262) | 5,942) | 5,991) | |
| Revenues | 20,248) | 17,117) | 17,290) | 15,983) | 12,093) | 12,483) | |
| Profitability Ratio | |||||||
| Gross profit margin1 | 46.56% | 44.27% | 47.94% | 45.44% | 49.14% | 47.99% | |
| Benchmarks | |||||||
| Gross Profit Margin, Competitors2 | |||||||
| Abbott Laboratories | 52.21% | 50.49% | — | — | — | — | |
| CVS Health Corp. | 17.48% | 18.01% | — | — | — | — | |
| Elevance Health Inc. | 17.09% | 19.71% | — | — | — | — | |
| Intuitive Surgical Inc. | 69.32% | 65.65% | — | — | — | — | |
| Medtronic PLC | 65.19% | 67.41% | — | — | — | — | |
| UnitedHealth Group Inc. | 23.60% | 25.62% | — | — | — | — | |
Based on: 10-K (reporting date: 2021-09-30), 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).
1 2021 Calculation
Gross profit margin = 100 × Gross profit ÷ Revenues
= 100 × 9,427 ÷ 20,248 = 46.56%
2 Click competitor name to see calculations.
- Gross profit
- Gross profit exhibited a generally upward trend over the six-year period. It started at 5991 million USD in 2016, saw a slight decline in 2017 to 5942 million USD, then increased significantly in 2018 to 7262 million USD. This growth trajectory continued in 2019 with gross profit reaching 8288 million USD. Although there was a decrease in 2020 to 7577 million USD, gross profit rebounded strongly in 2021, achieving the highest value of 9427 million USD within the period.
- Revenues
- Revenues followed a pattern of growth with some fluctuations. From 12483 million USD in 2016, revenues slightly declined to 12093 million USD in 2017. After this dip, revenues increased substantially to 15983 million USD in 2018, continuing upward to 17290 million USD in 2019. The following year, 2020, experienced a minor decline to 17117 million USD. However, revenues rose markedly again in 2021, reaching 20248 million USD, the highest recorded in the timeframe.
- Gross profit margin
- The gross profit margin showed variability without a consistent upward or downward trend. It began at 47.99% in 2016 and slightly increased to 49.14% in 2017. There was a noticeable decrease in 2018 to 45.44%, followed by recovery to 47.94% in 2019. The margin dipped again in 2020 to 44.27%, before partially recovering to 46.56% in 2021. Despite fluctuations, the margin generally remained within the mid-40 percent range across the years.
Operating Profit Margin
Becton, Dickinson & Co., operating profit margin calculation, comparison to benchmarks
| Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | Sep 30, 2018 | Sep 30, 2017 | Sep 30, 2016 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Operating income | 2,799) | 1,484) | 1,760) | 1,497) | 1,478) | 1,430) | |
| Revenues | 20,248) | 17,117) | 17,290) | 15,983) | 12,093) | 12,483) | |
| Profitability Ratio | |||||||
| Operating profit margin1 | 13.82% | 8.67% | 10.18% | 9.37% | 12.22% | 11.46% | |
| Benchmarks | |||||||
| Operating Profit Margin, Competitors2 | |||||||
| Abbott Laboratories | 19.56% | 15.48% | — | — | — | — | |
| CVS Health Corp. | 4.54% | 5.19% | — | — | — | — | |
| Elevance Health Inc. | 5.15% | 4.97% | — | — | — | — | |
| Intuitive Surgical Inc. | 31.89% | 24.09% | — | — | — | — | |
| Medtronic PLC | 14.89% | 16.57% | — | — | — | — | |
| UnitedHealth Group Inc. | 8.40% | 8.76% | — | — | — | — | |
| Operating Profit Margin, Sector | |||||||
| Health Care Equipment & Services | 7.44% | 7.51% | — | — | — | — | |
| Operating Profit Margin, Industry | |||||||
| Health Care | 14.99% | 11.62% | — | — | — | — | |
Based on: 10-K (reporting date: 2021-09-30), 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).
1 2021 Calculation
Operating profit margin = 100 × Operating income ÷ Revenues
= 100 × 2,799 ÷ 20,248 = 13.82%
2 Click competitor name to see calculations.
- Revenues
- Revenues demonstrated a fluctuating but overall upward trend from 2016 to 2021. Starting at 12,483 million USD in 2016, revenues slightly decreased in 2017 to 12,093 million USD. A significant increase occurred in 2018, reaching 15,983 million USD, followed by continued growth in 2019 to 17,290 million USD. Revenues remained relatively stable in 2020 at 17,117 million USD before rising sharply to 20,248 million USD in 2021.
- Operating Income
- The operating income showed a similar pattern to revenues, with some variability in growth rates. Operating income grew moderately from 1,430 million USD in 2016 to 1,478 million USD in 2017 and 1,497 million USD in 2018. A more pronounced increase occurred in 2019, reaching 1,760 million USD. There was a decline in 2020 to 1,484 million USD, followed by a notable surge in 2021, reaching 2,799 million USD, the highest point in the period analyzed.
- Operating Profit Margin
- The operating profit margin exhibited some volatility over the years. Starting at 11.46% in 2016, the margin increased slightly in 2017 to 12.22% but then decreased to 9.37% in 2018. It rose somewhat in 2019 to 10.18% before declining to the lowest point of 8.67% in 2020. In 2021, the margin recovered significantly to 13.82%, indicating improved operational efficiency or profitability relative to revenues.
- Summary of Trends and Insights
- Overall, the data reflect an upward trajectory in revenues and operating income over the six-year period, despite some years of stagnation or decline, particularly in 2017 and 2020. The most notable growth in both revenues and operating income occurred in 2021, suggesting a strong recovery or expansion phase. The operating profit margin fluctuated, indicating variable cost management or changes in business mix, but ended substantially higher in 2021 compared to the initial year, which may signify enhanced profitability dynamics.
Net Profit Margin
Becton, Dickinson & Co., net profit margin calculation, comparison to benchmarks
| Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | Sep 30, 2018 | Sep 30, 2017 | Sep 30, 2016 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Net income | 2,092) | 874) | 1,233) | 311) | 1,100) | 976) | |
| Revenues | 20,248) | 17,117) | 17,290) | 15,983) | 12,093) | 12,483) | |
| Profitability Ratio | |||||||
| Net profit margin1 | 10.33% | 5.11% | 7.13% | 1.95% | 9.10% | 7.82% | |
| Benchmarks | |||||||
| Net Profit Margin, Competitors2 | |||||||
| Abbott Laboratories | 16.42% | 12.99% | — | — | — | — | |
| CVS Health Corp. | 2.72% | 2.68% | — | — | — | — | |
| Elevance Health Inc. | 4.46% | 3.78% | — | — | — | — | |
| Intuitive Surgical Inc. | 29.85% | 24.33% | — | — | — | — | |
| Medtronic PLC | 11.97% | 16.56% | — | — | — | — | |
| UnitedHealth Group Inc. | 6.06% | 6.03% | — | — | — | — | |
| Net Profit Margin, Sector | |||||||
| Health Care Equipment & Services | 5.52% | 5.26% | — | — | — | — | |
| Net Profit Margin, Industry | |||||||
| Health Care | 12.42% | 8.45% | — | — | — | — | |
Based on: 10-K (reporting date: 2021-09-30), 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).
1 2021 Calculation
Net profit margin = 100 × Net income ÷ Revenues
= 100 × 2,092 ÷ 20,248 = 10.33%
2 Click competitor name to see calculations.
- Net Income
- The net income exhibited considerable fluctuations over the analyzed periods. Starting at $976 million in 2016, it increased to $1,100 million in 2017 before experiencing a significant drop to $311 million in 2018. Subsequently, it recovered sharply to $1,233 million in 2019, followed by a decline to $874 million in 2020. The most recent figure for 2021 shows a substantial rise to $2,092 million, indicating strong earnings growth in the last year.
- Revenues
- Revenues demonstrated an overall increasing trend from 2016 through 2021. Initial revenue was $12,483 million in 2016, slightly declining to $12,093 million in 2017. This was followed by robust growth to $15,983 million in 2018 and a continued upward trajectory to $17,290 million in 2019. Revenues held steady around $17,117 million in 2020 before reaching a peak of $20,248 million in 2021. This indicates a solid expansion in sales over the six-year span.
- Net Profit Margin
- The net profit margin experienced notable volatility. It started at 7.82% in 2016 and improved to 9.1% in 2017. However, there was a sharp decline to 1.95% in 2018, mirroring the significant drop in net income that year. Profitability rebounded to 7.13% in 2019 but then declined again to 5.11% in 2020. The margin improved markedly to 10.33% in 2021, the highest level in the analyzed period, suggesting enhanced profitability efficiency relative to revenues in the latest year.
Return on Equity (ROE)
Becton, Dickinson & Co., ROE calculation, comparison to benchmarks
| Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | Sep 30, 2018 | Sep 30, 2017 | Sep 30, 2016 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Net income | 2,092) | 874) | 1,233) | 311) | 1,100) | 976) | |
| Shareholders’ equity | 23,677) | 23,765) | 21,081) | 20,994) | 12,948) | 7,633) | |
| Profitability Ratio | |||||||
| ROE1 | 8.84% | 3.68% | 5.85% | 1.48% | 8.50% | 12.79% | |
| Benchmarks | |||||||
| ROE, Competitors2 | |||||||
| Abbott Laboratories | 19.75% | 13.71% | — | — | — | — | |
| CVS Health Corp. | 10.54% | 10.35% | — | — | — | — | |
| Elevance Health Inc. | 16.93% | 13.77% | — | — | — | — | |
| Intuitive Surgical Inc. | 14.32% | 10.90% | — | — | — | — | |
| Medtronic PLC | 7.01% | 9.44% | — | — | — | — | |
| UnitedHealth Group Inc. | 24.09% | 23.52% | — | — | — | — | |
| ROE, Sector | |||||||
| Health Care Equipment & Services | 15.49% | 14.35% | — | — | — | — | |
| ROE, Industry | |||||||
| Health Care | 23.78% | 15.95% | — | — | — | — | |
Based on: 10-K (reporting date: 2021-09-30), 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).
1 2021 Calculation
ROE = 100 × Net income ÷ Shareholders’ equity
= 100 × 2,092 ÷ 23,677 = 8.84%
2 Click competitor name to see calculations.
- Net Income
- The net income shows significant fluctuations over the examined periods. It started at 976 million USD in 2016, increased moderately to 1,100 million USD in 2017, then dropped sharply to 311 million USD in 2018. This low was followed by a recovery to 1,233 million USD in 2019, a decline to 874 million USD in 2020, and a substantial increase to 2,092 million USD in 2021, marking the highest value in the series.
- Shareholders’ Equity
- The shareholders' equity exhibits a steady upward trend throughout the period. It rose from 7,633 million USD in 2016 to 12,948 million USD in 2017, nearly doubling to 20,994 million USD in 2018. From 2018 through 2021, equity increased at a slower pace, reaching a peak of 23,677 million USD in 2021. This consistent growth indicates a strengthening capital base over time.
- Return on Equity (ROE)
- ROE experienced considerable volatility during the period. It was relatively high at 12.79% in 2016, then dropped sharply to 8.5% in 2017 and further to a low of 1.48% in 2018. A partial recovery occurred in 2019 with ROE increasing to 5.85%, followed by a decline to 3.68% in 2020. In 2021, ROE rebounded to 8.84%, reflecting improved profitability relative to shareholders' equity.
- Summary of Trends
- The company's net income and ROE have demonstrated volatility, with significant dips notably in 2018 and somewhat in 2020. However, both metrics recovered by 2021, with net income reaching a record high, contributing to a notable improvement in ROE. Meanwhile, shareholders' equity maintained a consistent upward trajectory, indicating an expanding equity base over the years. The pattern suggests episodes of fluctuating profitability amid an overall strengthening financial position.
Return on Assets (ROA)
Becton, Dickinson & Co., ROA calculation, comparison to benchmarks
| Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | Sep 30, 2018 | Sep 30, 2017 | Sep 30, 2016 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||
| Net income | 2,092) | 874) | 1,233) | 311) | 1,100) | 976) | |
| Total assets | 53,866) | 54,012) | 51,765) | 53,904) | 37,734) | 25,586) | |
| Profitability Ratio | |||||||
| ROA1 | 3.88% | 1.62% | 2.38% | 0.58% | 2.92% | 3.81% | |
| Benchmarks | |||||||
| ROA, Competitors2 | |||||||
| Abbott Laboratories | 9.40% | 6.20% | — | — | — | — | |
| CVS Health Corp. | 3.39% | 3.11% | — | — | — | — | |
| Elevance Health Inc. | 6.26% | 5.28% | — | — | — | — | |
| Intuitive Surgical Inc. | 12.58% | 9.50% | — | — | — | — | |
| Medtronic PLC | 3.87% | 5.28% | — | — | — | — | |
| UnitedHealth Group Inc. | 8.15% | 7.81% | — | — | — | — | |
| ROA, Sector | |||||||
| Health Care Equipment & Services | 6.03% | 5.44% | — | — | — | — | |
| ROA, Industry | |||||||
| Health Care | 8.70% | 5.45% | — | — | — | — | |
Based on: 10-K (reporting date: 2021-09-30), 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).
1 2021 Calculation
ROA = 100 × Net income ÷ Total assets
= 100 × 2,092 ÷ 53,866 = 3.88%
2 Click competitor name to see calculations.
The financial data over the six-year period reveals several noteworthy trends in profitability, asset base, and efficiency metrics.
- Net Income
- The net income exhibits considerable variability over the years. It increased from 976 million USD in 2016 to 1,100 million USD in 2017. However, in 2018, there was a sharp decline to 311 million USD, followed by a substantial recovery in 2019 reaching 1,233 million USD. A decline occurred again in 2020, with net income decreasing to 874 million USD, before rising sharply to the highest level in the period, 2,092 million USD, in 2021.
- Total Assets
- The total asset base shows a general upward trend from 25,586 million USD in 2016 to 53,866 million USD in 2021. The most pronounced growth occurred between 2016 and 2018, where assets more than doubled from approximately 25.6 billion to 53.9 billion USD. After a slight dip in 2019 to 51.8 billion USD, assets resumed a gradual increase through to 2021.
- Return on Assets (ROA)
- The ROA ratio displays significant fluctuations, reflecting the impacts of net income volatility relative to asset size changes. Starting at 3.81% in 2016, ROA dipped to 2.92% in 2017 and fell dramatically to 0.58% in 2018, coinciding with the sharp net income drop despite asset growth. It partially recovered to 2.38% in 2019 and subsequently declined to 1.62% in 2020. The ratio then improved markedly to 3.88% in 2021, reaching the highest level observed in the period, driven by the peak net income performance.
Overall, the data indicates a strong expansion of asset base with uneven profitability performance over the years. The significant swings in net income, particularly the sharp decline in 2018 and the substantial rebound in 2021, suggest episodic challenges and recovery phases. The ROA metric corroborates these dynamics, illustrating the company’s fluctuating efficiency in generating returns from its asset investments during this timeframe.