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Profitability Analysis
Difficulty: Beginner
Profitability ratios measure the company's ability to generate profitable sales from its resources (assets).
Ratios (Summary)
Caterpillar Inc., profitability ratios
Based on: 10-K (filing date: 2018-02-15), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-16), 10-K (filing date: 2015-02-17), 10-K (filing date: 2014-02-18).
| Ratio | Description | The company |
|---|---|---|
| Gross profit margin | Gross profit margin indicates the percentage of revenue available to cover operating and other expenditures. | Caterpillar Inc.'s gross profit margin deteriorated from 2015 to 2016 but then improved from 2016 to 2017 exceeding 2015 level. |
| Operating profit margin | A profitability ratio calculated as operating income divided by revenue. | Caterpillar Inc.'s operating profit margin deteriorated from 2015 to 2016 but then improved from 2016 to 2017 exceeding 2015 level. |
| Net profit margin | An indicator of profitability, calculated as net income divided by revenue. | Caterpillar Inc.'s net profit margin deteriorated from 2015 to 2016 but then slightly improved from 2016 to 2017. |
| Ratio | Description | The company |
|---|---|---|
| ROE | A profitability ratio calculated as net income divided by shareholders' equity. | Caterpillar Inc.'s ROE deteriorated from 2015 to 2016 but then slightly improved from 2016 to 2017. |
| ROA | A profitability ratio calculated as net income divided by total assets. | Caterpillar Inc.'s ROA deteriorated from 2015 to 2016 but then slightly improved from 2016 to 2017. |
Gross Profit Margin
Caterpillar Inc., gross profit margin calculation
Based on: 10-K (filing date: 2018-02-15), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-16), 10-K (filing date: 2015-02-17), 10-K (filing date: 2014-02-18).
2017 Calculations
1 Gross profit margin = 100 × Gross margin ÷ Sales of Machinery, Energy & Transportation
= 100 × ÷ =
| Ratio | Description | The company |
|---|---|---|
| Gross profit margin | Gross profit margin indicates the percentage of revenue available to cover operating and other expenditures. | Caterpillar Inc.'s gross profit margin deteriorated from 2015 to 2016 but then improved from 2016 to 2017 exceeding 2015 level. |
Operating Profit Margin
Caterpillar Inc., operating profit margin calculation, comparison to benchmarks
Based on: 10-K (filing date: 2018-02-15), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-16), 10-K (filing date: 2015-02-17), 10-K (filing date: 2014-02-18).
2017 Calculations
1 Operating profit margin = 100 × Operating profit ÷ Sales of Machinery, Energy & Transportation
= 100 × ÷ =
| Ratio | Description | The company |
|---|---|---|
| Operating profit margin | A profitability ratio calculated as operating income divided by revenue. | Caterpillar Inc.'s operating profit margin deteriorated from 2015 to 2016 but then improved from 2016 to 2017 exceeding 2015 level. |
Net Profit Margin
Caterpillar Inc., net profit margin calculation, comparison to benchmarks
Based on: 10-K (filing date: 2018-02-15), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-16), 10-K (filing date: 2015-02-17), 10-K (filing date: 2014-02-18).
2017 Calculations
1 Net profit margin = 100 × Profit (loss) attributable to common stockholders ÷ Sales of Machinery, Energy & Transportation
= 100 × ÷ =
| Ratio | Description | The company |
|---|---|---|
| Net profit margin | An indicator of profitability, calculated as net income divided by revenue. | Caterpillar Inc.'s net profit margin deteriorated from 2015 to 2016 but then slightly improved from 2016 to 2017. |
Return on Equity (ROE)
Caterpillar Inc., ROE calculation, comparison to benchmarks
Based on: 10-K (filing date: 2018-02-15), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-16), 10-K (filing date: 2015-02-17), 10-K (filing date: 2014-02-18).
2017 Calculations
1 ROE = 100 × Profit (loss) attributable to common stockholders ÷ Equity attributable to common stockholders
= 100 × ÷ =
| Ratio | Description | The company |
|---|---|---|
| ROE | A profitability ratio calculated as net income divided by shareholders' equity. | Caterpillar Inc.'s ROE deteriorated from 2015 to 2016 but then slightly improved from 2016 to 2017. |
Return on Assets (ROA)
Caterpillar Inc., ROA calculation, comparison to benchmarks
Based on: 10-K (filing date: 2018-02-15), 10-K (filing date: 2017-02-15), 10-K (filing date: 2016-02-16), 10-K (filing date: 2015-02-17), 10-K (filing date: 2014-02-18).
2017 Calculations
1 ROA = 100 × Profit (loss) attributable to common stockholders ÷ Total assets
= 100 × ÷ =
| Ratio | Description | The company |
|---|---|---|
| ROA | A profitability ratio calculated as net income divided by total assets. | Caterpillar Inc.'s ROA deteriorated from 2015 to 2016 but then slightly improved from 2016 to 2017. |
