Bristol-Myers Squibb Co. (NYSE:BMY)

Return on Assets (ROA)

The Return on Assets exhibited a marked improvement from -7.61% in 2020 to a positive range between 6.4% and 8.43% from 2021 through 2023, suggesting enhanced efficiency in asset utilization during these years. However, in 2024, the ROA sharply declined to -9.66%, indicating a significant reduction in asset profitability for that period.

Financial Leverage

The financial leverage ratio remained relatively stable between 3.04 and 3.23 from 2020 to 2023, implying a consistent level of debt relative to equity. In 2024, a notable increase to 5.67 was observed, which could signal a substantial rise in the company's reliance on debt financing.

Return on Equity (ROE)

The ROE showed considerable volatility over the analyzed periods. It transitioned from a negative value of -23.84% in 2020 to positive and growing values peaking at 27.27% in 2023, indicating improved profitability and shareholder returns. However, 2024 saw a dramatic reversal with a steep decline to -54.78%, highlighting a significant erosion in equity returns that year.

Net Profit Margin

The net profit margin exhibited significant volatility over the observed periods. Starting with a substantial negative margin of -21.2% in 2020, it improved sharply to positive figures in subsequent years, reaching 15.08% in 2021 and slightly declining to 13.71% in 2022. There was a rebound to 17.83% in 2023, followed by a notable decline into negative territory again at -18.53% in 2024. This pattern indicates fluctuating profitability with periods of both recovery and decline.

Asset Turnover

Asset turnover showed a generally positive trend throughout the years. It increased steadily from 0.36 in 2020 to 0.42 in 2021, then continued its upward trajectory to 0.48 in 2022. The ratio slightly dipped to 0.47 in 2023 but rose again to 0.52 in 2024. This indicates a gradual improvement in the efficiency with which the company utilized its assets to generate revenue.

Financial Leverage

Financial leverage was mostly stable from 2020 through 2023, fluctuating modestly around values between 3.04 and 3.23. However, in 2024, there was a sharp and significant spike to 5.67, suggesting an increased reliance on debt or other liabilities relative to equity. This sudden increase in leverage could reflect a change in capital structure or increased borrowing during that period.

Return on Equity (ROE)

ROE experienced considerable fluctuations aligned in part with the net profit margin trends. It was deeply negative at -23.84% in 2020, turned positive by 19.46% in 2021, and showed a moderate increase to 20.37% in 2022. The upward trend continued, peaking at 27.27% in 2023. However, the year 2024 saw a severe decline to -54.78%, indicating a substantial erosion of shareholder equity returns, likely connected to the negative profit margin and higher leverage in the same period.

The analysis of the financial ratios over the reported periods reveals several notable trends and fluctuations in the company's profitability and operational efficiency metrics.

Tax Burden

The tax burden ratio shows variability between 2021 and 2023, with values of 0.87 in 2021, declining to 0.82 in 2022, before increasing markedly to 0.95 in 2023. This suggests that the proportion of earnings retained after taxes initially improved but then reversed, indicating a heavier tax impact in 2023.

Interest Burden

The interest burden ratio remains relatively stable over the observed years, hovering around 0.86 to 0.88, which implies consistent interest expense relative to earnings before interest and taxes, with only a slight easing in 2023.

EBIT Margin (%)

The EBIT margin demonstrates significant volatility. It was negative at -12.87% in 2020, then surged to a healthy positive level above 19% in the years 2021 through 2023. However, it sharply reverted to a negative figure (-13.35%) in 2024. This fluctuation points to periods of improving operational profitability followed by a substantial decline.

Asset Turnover (ratio)

There is a consistent upward trend in asset turnover, increasing from 0.36 in 2020 to 0.52 in 2024 (excluding missing data). The improvement signals enhanced efficiency in using assets to generate sales over time, despite the absence of data for 2024 being partially unavailable.

Financial Leverage (ratio)

Financial leverage remains fairly stable around 3.1 from 2020 through 2023 but exhibits a sharp increase to 5.67 in 2024. This marked increase indicates a significant rise in the use of debt relative to equity, which could imply higher financial risk or a strategic shift in capital structure during the last reported period.

Return on Equity (ROE, %)

ROE shows major oscillations. It begins negative in 2020 at -23.84%, improves to strong positive figures from 2021 (19.46%) through 2023 (27.27%), but then drastically reverses to a deep negative -54.78% in 2024. This volatility reflects a combination of earnings fluctuation and changes in financial leverage, impacting shareholders' returns significantly.

Overall, the financial metrics reveal a pattern of recovery and growth from 2020 to 2023, followed by a sharp decline in profitability and a substantial rise in financial leverage in 2024. The increased financial leverage coupled with deteriorating profitability ratios in 2024 may warrant further investigation into the underlying causes and potential implications for financial stability.

The financial data reveals fluctuating performance over the five-year period from 2020 to 2024. Key profitability and efficiency indicators show varied trends, which merit detailed examination.

Net Profit Margin (%)

The net profit margin experienced significant volatility. In 2020, the margin was deeply negative at -21.2%, indicating substantial losses. A marked recovery is observed in 2021, with the margin rising sharply to 15.08%. This positive trend continued into 2022 and 2023, with margins of 13.71% and 17.83%, respectively, reflecting improved profitability. However, a reversal occurred in 2024, where the margin dropped substantially to -18.53%, indicating a return to losses.

Asset Turnover (ratio)

Asset turnover exhibited a generally positive and upward trend throughout the period. from 0.36 in 2020, it increased consistently each year to reach 0.52 in 2024. This suggests progressively more efficient use of assets to generate sales over time, with only slight fluctuation observed in 2023 (0.47), which was marginally lower than the previous year.

Return on Assets (ROA) (%)

Return on assets mirrors the volatility seen in net profit margin. Starting with a negative ROA of -7.61% in 2020, the metric improved to positive territory at 6.4% in 2021 and showed a slight increase to 6.53% in 2022. A further rise to 8.43% in 2023 indicates enhanced asset profitability. Despite this improvement, 2024 saw a significant decline back to -9.66%, suggesting decreased overall efficiency in generating profits from assets.

Overall, the data depicts a cycle of recovery and subsequent downturn. The positive growth in asset turnover suggests operational efficiency gains, yet profitability measures, including net profit margin and ROA, indicate vulnerability to external or internal factors affecting earnings. The sharp reversion to negative margins and ROA in 2024 is notable and warrants further investigation to identify underlying causes.

The financial data shows varying performance trends over the period from 2020 to 2024, highlighting changes in profitability, efficiency, and burden ratios.

Tax Burden

The tax burden ratio increased from 0.87 in 2021 to a peak of 0.95 in 2023, indicating a higher proportion of pre-tax income retained after taxes. However, data for 2020 and 2024 are missing, limiting comprehensive trend analysis across all years.

Interest Burden

The interest burden remained relatively stable, with a slight increase from 0.86 in 2021 and 2022 to 0.88 in 2023, suggesting consistent management of interest expenses relative to operating earnings.

EBIT Margin

The EBIT margin showed significant fluctuations. It was negative at -12.87% in 2020, then improved sharply to above 19% in 2021 through 2023, reaching 21.31% in 2023. However, it returned to a negative figure of -13.35% in 2024, indicating a major decline in operating profitability in the latest reported year.

Asset Turnover

Asset turnover increased from 0.36 in 2020 to 0.52 in 2024, demonstrating enhanced efficiency in generating sales from assets. A slight dip occurred in 2023 (0.47) compared to 2022 (0.48), but overall the trend shows improving asset utilization.

Return on Assets (ROA)

ROA followed a volatile trajectory: negative at -7.61% in 2020, it turned positive by 6.4% in 2021 and remained slightly improved around 6.5% in 2022, then rose to 8.43% in 2023, reflecting improving overall profitability from assets. Nevertheless, it dropped sharply to -9.66% in 2024, consistent with the negative EBIT margin trend observed that year.

In summary, the company experienced recovery and improvement in operating performance and asset efficiency from 2020 through 2023, as evidenced by rising EBIT margins, ROA, and asset turnover. Both the tax and interest burden remained relatively stable during the period with gradual increases. However, a notable downturn occurred in 2024, with a return to negative EBIT margin and ROA, signaling a significant operational or financial challenge impacting profitability in that year.

Tax Burden

The tax burden ratio was not available for 2020 but shows a downward trend from 0.87 in 2021 to 0.82 in 2022, followed by an increase to 0.95 in 2023. This indicates fluctuations in the proportion of earnings retained after tax, with a notable increase in 2023 suggesting potentially lower tax expenses relative to earnings in that period.

Interest Burden

Interest burden remains relatively stable over the reported periods, moving slightly from 0.86 in 2021 and 2022 to a marginally higher 0.88 in 2023. This stability suggests consistent management of interest expenses relative to earnings before interest and taxes.

EBIT Margin

The EBIT margin exhibits significant variability. A negative margin in 2020 of -12.87% sharply improves to 20.29% in 2021 and remains relatively stable around 19-21% through 2023, before declining drastically to -13.35% in 2024. This pattern reflects considerable volatility in operating profitability, with a strong recovery post-2020 followed by a severe decrease in 2024.

Net Profit Margin

Net profit margin parallels the EBIT margin trend, starting with a negative margin of -21.2% in 2020, then recovering to positive figures between 13.71% and 17.83% from 2021 to 2023. However, it drops again to -18.53% in 2024. This indicates the company faced challenges in maintaining net profitability, aligning with observed fluctuations in operating income.