Chevron Corp. (NYSE:CVX)

Return on Assets (ROA)

The ROA shows an initial negative trend beginning in the fourth quarter of 2020, reaching lows of -3.21%. Subsequently, the company experienced a marked improvement starting in the first quarter of 2021, moving into positive territory with an upward trend peaking around the fourth quarter of 2022 at approximately 13.98%. After this peak, ROA exhibits a gradual decline, decreasing from nearly 12% in early 2023 to about 5.47% by the second quarter of 2025, indicating a deceleration in asset profitability over the latter periods.

Financial Leverage

The financial leverage ratio remained relatively stable throughout the observed periods, with values fluctuating modestly between 1.59 and 1.83. Starting at 1.64 in the first quarter of 2020, the ratio saw a slight increase up to 1.83 in the first quarter of 2021 before trending downward to a low around 1.59 in the middle of 2023. From mid-2023 onward, financial leverage shows a gradual, steady increase again, approaching approximately 1.71 by mid-2025, suggesting consistent moderate use of debt in the company’s capital structure without significant volatility.

Return on Equity (ROE)

ROE displayed a similar pattern to ROA, starting with negative returns in the fourth quarter of 2020 at about -5.89%. This was followed by a strong recovery and growth phase from early 2021, reaching a high point of roughly 22.44% in the fourth quarter of 2022. After hitting this peak, ROE progressively declined through 2023 and into 2025, moving from around 19.05% in the first quarter of 2023 down to approximately 9.37% in the second quarter of 2025. This trend indicates that while equity returns were robust through 2022, there has been a consistent reduction in profitability on equity invested over recent quarters.

Net Profit Margin

The net profit margin shows a significant turnaround starting in 2020. Initially, in December 2020, it was negative at -5.87%, dipping further to -8.1% in March 2021. However, from June 2021 onwards, the margin turned positive and exhibited a steady upward trend, peaking at 15.41% in March 2023. After this peak, there is a gradual decline observed, with margins decreasing consistently each quarter to reach 7.31% by June 2025. Despite the decline, the margin remains positive throughout this later period, indicating sustained profitability albeit at a reduced level compared to the peak.

Asset Turnover

Asset turnover ratios were unavailable for early 2020 but become available from March 2021 at 0.39, showing a continuous increase to a high of 0.91 by March 2023. Following this peak, asset turnover ratios demonstrate a mild decline, stabilizing around 0.75 in subsequent quarters through June 2025. The initial rise suggests improving efficiency in asset utilization over the early periods, while the later stabilization indicates a plateau in operational efficiency.

Financial Leverage

Financial leverage increased gradually from 1.64 at the beginning of 2020 to a peak of 1.83 in March 2021. After this point, it declined steadily to 1.59 by June 2023, then showed a slight upward adjustment, fluctuating around 1.7 toward mid-2025. This indicates a period of deleveraging following early 2021, subsequently stabilizing with modest increases in leverage in the later periods.

Return on Equity (ROE)

ROE mirrors the patterns observed in net profit margin. It began negative at -4.21% in December 2020, plunging further to -5.89% in March 2021. From June 2021, ROE turned positive and increased sharply to a peak of 22.44% in March 2023. After this peak, a consistent decline ensued, with ROE decreasing each quarter to 9.37% by June 2025. Despite the decline, the levels remain notably higher than the initial negative returns, indicating improved but tapering shareholder profitability over time.

The analysis of the quarterly financial data reveals several distinct patterns and directional movements in key financial ratios over the observed period.

Tax Burden Ratio

The tax burden ratio began to be recorded from mid-2021, showing values mostly stable around 0.72 to 0.73 for several quarters. Starting in early 2024, a gradual decline is visible, decreasing from 0.72 to 0.62 by mid-2025, indicating a reduced impact of taxes on profits during these later periods.

Interest Burden Ratio

This ratio exhibits an improving trend from mid-2021 onward, increasing consistently from 0.88 to 0.99 and maintaining near this high level through much of 2023, denoting a strong ability to cover interest expenses from operating income. A slight decline occurs in 2024 and 2025, ending at 0.96, still indicating effective interest coverage.

EBIT Margin (%)

Initially negative in early 2020, the EBIT margin turns positive from late 2020, then shows a strong upward trend, peaking in 2022 at over 21%. Thereafter, the margin declines steadily through 2023 and into 2024 and 2025, falling to about 12.3%. This suggests that operational profitability improved notably post-2020 but faced pressures leading to margin compression in recent quarters.

Asset Turnover Ratio

There is a clear upward trend in asset turnover from 2020 to 2022, rising from 0.39 to a high of 0.91, indicating improved efficiency in using assets to generate revenue. However, from early 2023 onwards, this ratio declines slightly and stabilizes near 0.75, suggesting a moderation in asset utilization efficiency.

Financial Leverage Ratio

Financial leverage gradually increased from 1.64 in early 2020 to approximately 1.83 by mid-2021, reflecting increased reliance on debt or other financing. Afterward, leverage decreases steadily to about 1.6-1.63 levels in 2023, before slowly rising again through 2024 and into 2025, indicating some fluctuation but overall moderate leverage levels.

Return on Equity (ROE) (%)

ROE shows a negative position during early 2020, turning positive by late 2020 and climbing significantly to a peak above 22% in late 2022. This growth mirrors improvements in profitability and operational performance. However, a decline follows in 2023 and continues into 2024 and mid-2025, with ROE dropping to around 9.4%, signaling reduced returns to shareholders despite positive levels.

Overall, the data portrays a recovery from early negative profitability and efficiency levels in 2020, reaching strong performance by 2022. Since then, several indicators such as EBIT margin, asset turnover, and ROE have shown a downward adjustment, while leverage and burden ratios have remained relatively stable with minor decreases in tax and interest burdens. The trends suggest a cycle of performance improvement followed by moderation in profitability and efficiency in the most recent periods.

Net Profit Margin

The net profit margin experienced a significant fluctuation during the analyzed periods. Initially, there were negative values of -5.87% and -8.10% in the first two quarters of 2020, indicating losses. Starting from the third quarter of 2020, profitability turned positive and showed a steady upward trend, peaking around the fourth quarter of 2022 at approximately 15.41%. Following this peak, there was a gradual decline in the margin through 2023 and into 2024, settling near 7.31% by the third quarter of 2025. This trend suggests that the company recovered from early losses and achieved strong profitability, but the margin has softened somewhat in recent quarters.

Asset Turnover

Asset turnover ratios were initially low at 0.39 in the first reported quarter (March 2020) but demonstrated a steady and consistent improvement through 2022, reaching a peak of 0.91 around the first three quarters of 2023. However, from late 2023 onwards, asset turnover showed a slight downward adjustment, stabilizing around 0.75 from mid-2024 through to the third quarter of 2025. This pattern indicates enhanced efficiency in utilizing assets to generate revenue up to 2023, followed by maintenance of a moderate level of asset utilization thereafter.

Return on Assets (ROA)

Return on assets closely follows the trends observed in net profit margin and asset turnover. Initially negative at -2.31% and -3.21% in early 2020, ROA shifted to positive territory by the third quarter of 2020. It then steadily rose, reaching a maximum of approximately 13.98% in the first quarter of 2023. Post this peak, a gradual decline is noticeable, with ROA decreasing to 5.47% by the third quarter of 2025. This trend reflects improvement in overall asset profitability through 2022 and early 2023, followed by a tapering off in efficiency or profit generation capacity relative to assets.

The financial ratios exhibit several notable trends over the observed periods. Starting with the Tax Burden ratio, data begins from the third quarter of 2020 and initially shows a value of 0.65 in the third quarter of 2020. This ratio increases steadily, stabilizing around 0.72 to 0.73 for most of 2021 and 2022. However, from the beginning of 2023, there is a gradual decline in the Tax Burden ratio, concluding at 0.62 by the second quarter of 2025. This pattern suggests an increasing tax efficiency or potentially changes in tax policy followed by a slight reduction in the effective tax rate in later periods.

The Interest Burden ratio, which also has data starting from mid-2020, shows a general improvement. Beginning at 0.88 in the third quarter of 2020, it climbs steadily to a near-perfect 0.99 by early 2021 and maintains this high level through 2022 and most of 2023. Slight decreases occur from late 2023 onward, ending at 0.96 in the second quarter of 2025. This trend indicates effective cost management related to interest expenses and a reduction in financial leverage or interest costs over time.

The EBIT Margin reveals substantial variation, especially in the early periods. It starts with negative margins in the first half of 2020, reaching a nadir near -9%. From mid-2020 onwards, the margin improves sharply, turning positive by the third quarter of 2020 and peaking at over 21% in the first half of 2022. Subsequently, the EBIT Margin gradually declines to approximately 12% by mid-2025. This trajectory reflects a recovery and strong earnings performance post-2020, followed by a normalization or slight weakening of operating profitability in the later periods.

Asset Turnover shows an upward trajectory beginning at 0.39 in the first quarter of 2020 and improving steadily to a peak near 0.91 in late 2022. After this peak, the ratio declines somewhat, stabilizing around 0.75 from early 2024 through mid-2025. The increase to 2022 suggests enhanced efficiency in asset utilization, while the subsequent stabilization may indicate a plateau in operational capacity or sales relative to assets.

The Return on Assets (ROA) closely follows the pattern of the EBIT Margin, starting from negative values (-2.31% in early 2020 and falling to -3.21% in mid-2020), turning positive in late 2020, and growing to a peak of nearly 14% in the second quarter of 2022. Post-peak, ROA declines steadily to slightly above 5% by mid-2025. This denotes an initial recovery and strengthening of overall asset profitability, followed by a moderation likely influenced by declining margins and asset turnover stabilization.

In summary, the financial data indicates a recovery phase starting from the latter part of 2020, with improved profitability, efficient asset utilization, and controlled interest expenses. The period of 2021 to 2022 reflects optimal operating and financial performance, after which there is gradual moderation in profitability and efficiency ratios, possibly reflecting changing market conditions, competitive pressures, or internal operational adjustments.

Tax Burden

Improved from 0.65 to about 0.73 in 2021-2022, then declined to 0.62 by mid-2025.

Interest Burden

Increased from 0.88 in 2020 to a near-perfect 0.99 by 2021, holding high until slight easing to 0.96 in 2025.

EBIT Margin

Recovered from negative (-9.09%) in mid-2020 to a peak over 21% in 2022, then gradually decreased to around 12% in 2025.

Asset Turnover

Improved steadily from 0.39 in early 2020 to 0.91 in late 2022, followed by a decline and stabilization near 0.75.

Return on Assets (ROA)

Moved from negative figures in 2020 (-3.21%) to a peak near 14% in 2022, then declined steadily to about 5.5% by 2025.

The analysis of the financial ratios over the given periods reflects several notable trends in profitability and financial burden management.

Tax Burden

The tax burden ratio is absent in the initial periods but is available from the third quarter of 2020 onwards. From this point forward, the ratio remains relatively stable, fluctuating between approximately 0.62 and 0.73. A slight declining trend is observable from the end of 2023 through mid-2025, indicating a gradual reduction in the proportion of earnings paid in taxes during these recent periods.

Interest Burden

The interest burden ratio is measurable starting in the third quarter of 2020. Initially, it shows an upward movement from 0.88 to a peak near 0.99 during 2021 through 2023, indicating a reduced interest expense impact on earnings before taxes, and thus improved ability to cover interest obligations from operating profits. From the beginning of 2024, a minor decline occurs but the ratio remains high near 0.96 to 0.98, still reflecting relatively low interest burden.

EBIT Margin

Operating profitability, as represented by EBIT margin, experiences a significant recovery and growth. Negative margins prevail in the middle of 2020, reaching lows around -9.09%. Starting from early 2021, EBIT margin improves sharply, reaching double-digit positive percentages peaking near 21.73% at the end of 2022. Thereafter, a gradual decline is observed from 2023 through 2025, with margins lowering to about 12.28% by the second quarter of 2025.

Net Profit Margin

Net profitability mirrors the pattern of the EBIT margin with initial negative values in 2020, followed by a rebound into positive territory beginning in early 2021. The net margin peaks around 15.41% in mid to late 2023 and then exhibits a gradual downward trend through mid-2025, reducing to approximately 7.31%. This decline suggests pressures on overall profitability after tax and interest expenses in the most recent periods.

Overall, the financial indicators point to a recovery phase following significant early negative profitability, with improved operational efficiency and reduced interest impact during 2021 to 2023. However, the latest data from 2024 onwards indicates a moderate erosion in profitability margins and a slight lowering of tax burden, potentially signaling changing economic or operational conditions affecting earnings retention.