Analysis of Profitability Ratios
Profitability ratios measure the company ability to generate profitable sales from its resources (assets).
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- Common-Size Income Statement
- Analysis of Short-term (Operating) Activity Ratios
- Analysis of Reportable Segments
- Enterprise Value (EV)
- Enterprise Value to EBITDA (EV/EBITDA)
- Dividend Discount Model (DDM)
- Return on Equity (ROE) since 2005
- Total Asset Turnover since 2005
- Price to Book Value (P/BV) since 2005
- Aggregate Accruals
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Profitability Ratios (Summary)
Chevron Corp., profitability ratios
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Return on Sales | ||||||
| Operating profit margin | ||||||
| Net profit margin | ||||||
| Return on Investment | ||||||
| Return on equity (ROE) | ||||||
| Return on assets (ROA) | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
- Operating Profit Margin
- The operating profit margin demonstrated a significant turnaround over the five-year period. Starting at a negative value of -6.22% in 2020, it shifted to a positive 14.81% in 2021, indicating a notable recovery in operational efficiency. The margin peaked at 21.42% in 2022 before experiencing a gradual decline to 15.37% in 2023 and slightly decreasing further to 14.63% in 2024. This pattern suggests improved profitability initially, followed by some contraction in operational profitability in the latter years.
- Net Profit Margin
- The net profit margin mirrored the operating margin trend, rising from a negative -5.87% in 2020 to a positive 10.04% in 2021, reflecting improved overall profitability. It increased further to 15.05% in 2022, then decreased to 10.85% in 2023, and continued a downward trend to 9.13% in 2024. The data indicates the company faced rising costs or other factors impacting net profitability in the most recent years despite earlier gains.
- Return on Equity (ROE)
- Return on equity showed a marked improvement from a negative 4.21% in 2020 to 11.24% in 2021, indicating stronger returns generated on shareholder investment. The ROE peaked at 22.27% in 2022, reinforcing a phase of high profitability. However, a decline followed, with values dropping to 13.28% in 2023 and further to 11.59% in 2024. This decline aligns with the patterns observed in profit margins, reflecting a reduction in equity returns in recent periods.
- Return on Assets (ROA)
- The return on assets improved significantly from -2.31% in 2020 to 6.52% in 2021, demonstrating better asset utilization for generating profits. It further increased to 13.76% in 2022, the highest point observed, before declining to 8.17% in 2023 and 6.87% in 2024. Similar to other profitability metrics, this indicates a phase of peak performance followed by moderate regression in effectively leveraging assets to produce earnings.
- Overall Observations
- The data reveals a clear recovery and growth phase between 2020 and 2022, with all profitability ratios moving from negative or low base values to significant positive peaks in 2022. However, from 2022 onward, there is a consistent downward trend across all key profitability indicators through to 2024. This suggests that although the company rebounded strongly after 2020, it has faced challenges maintaining peak profitability levels in subsequent years.
Return on Sales
Return on Investment
Operating Profit Margin
Chevron Corp., operating profit margin calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Operating income (loss) | ||||||
| Sales and other operating revenues | ||||||
| Profitability Ratio | ||||||
| Operating profit margin1 | ||||||
| Benchmarks | ||||||
| Operating Profit Margin, Competitors2 | ||||||
| ConocoPhillips | ||||||
| Exxon Mobil Corp. | ||||||
| Occidental Petroleum Corp. | ||||||
| Operating Profit Margin, Sector | ||||||
| Oil, Gas & Consumable Fuels | ||||||
| Operating Profit Margin, Industry | ||||||
| Energy | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Operating profit margin = 100 × Operating income (loss) ÷ Sales and other operating revenues
= 100 × ÷ =
2 Click competitor name to see calculations.
The financial data reveals significant fluctuations in operating income and sales over the observed periods, alongside notable variations in profitability margins.
- Operating Income
- There is a marked shift from a substantial operating loss of -$5,876 million in 2020 to a positive operating income of $23,039 million in 2021. This upward trajectory continues with a peak at $50,485 million in 2022, followed by a decline to $30,265 million in 2023 and a further slight decrease to $28,295 million in 2024. The trend indicates recovery and growth post-2020, with some normalization after the 2022 peak.
- Sales and Other Operating Revenues
- Sales revenue exhibits a steady increase from $94,471 million in 2020 to $235,717 million in 2022, more than doubling within two years. However, this growth is followed by a reduction to $196,913 million in 2023 and a slight further decline to $193,414 million in 2024. The pattern suggests strong expansion leading up to 2022, succeeded by a contraction phase.
- Operating Profit Margin
- The operating profit margin reflects earnings efficiency related to sales and other revenues. It transitions from a negative margin of -6.22% in 2020 to a robust 14.81% in 2021, continuing to 21.42% in 2022, which is the highest point. Afterwards, it contracts to 15.37% in 2023 and slightly dips again to 14.63% in 2024. This trend corresponds with the fluctuations seen in operating income and revenues, indicating enhanced profitability post-2020 with some decline after 2022.
Overall, the data portrays a recovery and expansion in operating results and revenues following a challenging 2020, reaching peak performance in 2022. Subsequent years show a retreat from these peaks but maintain levels significantly above the 2020 baseline, suggesting stabilization at a new operating scale and profitability benchmark.
Net Profit Margin
Chevron Corp., net profit margin calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income (loss) attributable to Chevron Corporation | ||||||
| Sales and other operating revenues | ||||||
| Profitability Ratio | ||||||
| Net profit margin1 | ||||||
| Benchmarks | ||||||
| Net Profit Margin, Competitors2 | ||||||
| ConocoPhillips | ||||||
| Exxon Mobil Corp. | ||||||
| Occidental Petroleum Corp. | ||||||
| Net Profit Margin, Sector | ||||||
| Oil, Gas & Consumable Fuels | ||||||
| Net Profit Margin, Industry | ||||||
| Energy | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Net profit margin = 100 × Net income (loss) attributable to Chevron Corporation ÷ Sales and other operating revenues
= 100 × ÷ =
2 Click competitor name to see calculations.
- Net income (loss) attributable to Chevron Corporation
- There was a significant turnaround in net income from a loss of US$ -5543 million in 2020 to positive earnings in subsequent years. Net income rose sharply to US$ 15625 million in 2021 and increased further to US$ 35465 million in 2022, indicating strong profitability recovery. However, in 2023 and 2024, net income declined to US$ 21369 million and US$ 17661 million respectively, showing a reduction in profitability from the peak in 2022 but remaining substantially positive.
- Sales and other operating revenues
- Sales revenues demonstrated a consistent upward trend over the period from 2020 to 2022, growing from US$ 94471 million in 2020 to a peak of US$ 235717 million in 2022. After reaching this peak, revenues decreased in 2023 and 2024 to US$ 196913 million and US$ 193414 million respectively. Despite this decline from the 2022 high, sales remain substantially higher than the 2020 baseline, indicating overall growth over the five-year period.
- Net profit margin
- The net profit margin exhibited a notable recovery from negative 5.87% in 2020 to a positive 10.04% in 2021. It further improved to a peak margin of 15.05% in 2022, reflecting enhanced profitability in relation to sales. In the following years, 2023 and 2024, the net profit margin decreased to 10.85% and 9.13% respectively, indicating a reduction in profitability efficiency compared to the peak year but still maintaining a healthy positive margin.
Return on Equity (ROE)
Chevron Corp., ROE calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income (loss) attributable to Chevron Corporation | ||||||
| Total Chevron Corporation stockholders’ equity | ||||||
| Profitability Ratio | ||||||
| ROE1 | ||||||
| Benchmarks | ||||||
| ROE, Competitors2 | ||||||
| ConocoPhillips | ||||||
| Exxon Mobil Corp. | ||||||
| Occidental Petroleum Corp. | ||||||
| ROE, Sector | ||||||
| Oil, Gas & Consumable Fuels | ||||||
| ROE, Industry | ||||||
| Energy | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
ROE = 100 × Net income (loss) attributable to Chevron Corporation ÷ Total Chevron Corporation stockholders’ equity
= 100 × ÷ =
2 Click competitor name to see calculations.
- Net Income (Loss) Attributable to Chevron Corporation
- The net income showed significant volatility over the five-year period. In 2020, the company reported a substantial net loss of -$5,543 million. This was followed by robust recoveries in subsequent years, with net income rising sharply to $15,625 million in 2021 and further increasing to $35,465 million in 2022. However, in 2023 and 2024, the net income decreased to $21,369 million and $17,661 million respectively, indicating a downward trend after the peak in 2022.
- Total Chevron Corporation Stockholders’ Equity
- Stockholders’ equity exhibited a general upward trend from 2020 to 2023, increasing from $131,688 million to a peak of $160,957 million. In 2024, equity slightly declined to $152,318 million. Despite the minor decrease in the final year, the overall growth in equity over the period suggests the company strengthened its financial base across the timeframe.
- Return on Equity (ROE)
- ROE mirrored the fluctuations in net income, starting with a negative return of -4.21% in 2020. It then improved substantially to 11.24% in 2021 and reached a high of 22.27% in 2022, reflecting effective utilization of equity to generate earnings. Subsequently, ROE declined to 13.28% in 2023 and further to 11.59% in 2024, yet it remained positive, signaling continued profitability albeit at reduced efficiency compared to the peak.
- Overall Summary
- The financial data demonstrates a recovery and growth phase after a loss in 2020, peaking in 2022 with strong net income and ROE figures. The decline in both profitability and return metrics in the later years suggests potential challenges or changing market conditions affecting earnings performance. Nevertheless, the overall increase in equity indicates a sustained capital base that supports ongoing business operations.
Return on Assets (ROA)
Chevron Corp., ROA calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income (loss) attributable to Chevron Corporation | ||||||
| Total assets | ||||||
| Profitability Ratio | ||||||
| ROA1 | ||||||
| Benchmarks | ||||||
| ROA, Competitors2 | ||||||
| ConocoPhillips | ||||||
| Exxon Mobil Corp. | ||||||
| Occidental Petroleum Corp. | ||||||
| ROA, Sector | ||||||
| Oil, Gas & Consumable Fuels | ||||||
| ROA, Industry | ||||||
| Energy | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
ROA = 100 × Net income (loss) attributable to Chevron Corporation ÷ Total assets
= 100 × ÷ =
2 Click competitor name to see calculations.
The financial data over the five-year period indicates notable fluctuations and trends across key performance indicators.
- Net Income (Loss) Attributable to Chevron Corporation (US$ in millions)
- There was a significant turnaround from a substantial net loss of $5,543 million in 2020 to a strong net income of $15,625 million in 2021, showing a recovery. This upward trend continued in 2022, with net income more than doubling to $35,465 million. However, this peak was followed by a decline in 2023 and 2024, with net income decreasing to $21,369 million and further to $17,661 million, respectively. Despite these declines, profitability remained positive and considerably higher than in 2020.
- Total Assets (US$ in millions)
- Total assets exhibited moderate growth from $239,790 million in 2020 to $239,535 million in 2021, remaining relatively stable year-over-year. A more noticeable increase occurred in 2022, with assets rising to $257,709 million, followed by continued but more restrained growth in 2023 to $261,632 million. There was a slight decrease in total assets to $256,938 million in 2024, signaling a possible cautious asset management or divestiture.
- Return on Assets (ROA) %
- The return on assets data reflects the profitability efficiency relative to the asset base. ROA was negative in 2020 at -2.31%, corresponding to the net loss reported. This improved dramatically to 6.52% in 2021, showing enhanced asset utilization, then peaked at 13.76% in 2022, coinciding with the highest net income figure. However, similar to net income, ROA decreased to 8.17% in 2023 and further declined to 6.87% in 2024, indicating diminishing returns on the asset base despite positive profitability.
Overall, the data indicates a recovery from a significant loss in 2020 to strong profitability in subsequent years, peaking in 2022. Although net income and ROA decreased thereafter, both metrics remained well above the 2020 levels. Total assets showed a gradual increase, suggesting an expansion in resources supporting business operations, with a slight contraction in the most recent year.