DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
Quarterly Data
Decomposing ROE involves expressing net income divided by shareholders’ equity as the product of component ratios.
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Two-Component Disaggregation of ROE
Deckers Outdoor Corp., decomposition of ROE (quarterly data)
Based on: 10-Q (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-K (reporting date: 2023-03-31), 10-Q (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-K (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-K (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-K (reporting date: 2020-03-31), 10-Q (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-K (reporting date: 2019-03-31), 10-Q (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-K (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30).
- Return on Assets (ROA)
- The ROA data exhibits a consistent upward trajectory starting from the first recorded value in March 2018. Initially, the ROA was around 9.05%, increasing steadily and peaking at 21.62% by December 2023. Notably, there are minor fluctuations throughout the periods, but the general trend indicates enhanced efficiency in asset utilization over time. The ROA remained above 15% from the early part of 2019 onward, suggesting sustained profitability relative to the asset base.
- Financial Leverage
- Financial leverage ratios show moderate variability over the entire span. Initially, values fluctuated around the 1.3 to 1.7 range without a clear long-term upward or downward trend. Peaks were observed near 1.85 in September 2019 and values gently declined to about 1.45 by March 2023, followed by a slight rebound to 1.59 at the end of 2023. This pattern implies a relatively stable level of reliance on debt financing with some cyclical adjustments, without aggressive shifts in capital structure.
- Return on Equity (ROE)
- The ROE consistently demonstrates strong growth, starting from 12.16% in June 2018 and rising to a high of 34.4% by December 2023. The upward trend is pronounced, with ROE surpassing 25% from late 2018 onwards and showing several peaks above 30% from 2019. This indicates improved profitability from shareholders’ perspective, likely supported by the increases in both asset efficiency and maintained financial leverage. Despite some fluctuations, the overall performance in ROE are robust and suggest effective utilization of equity capital.
Three-Component Disaggregation of ROE
Deckers Outdoor Corp., decomposition of ROE (quarterly data)
Based on: 10-Q (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-K (reporting date: 2023-03-31), 10-Q (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-K (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-K (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-K (reporting date: 2020-03-31), 10-Q (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-K (reporting date: 2019-03-31), 10-Q (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-K (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30).
- Net Profit Margin
- The Net Profit Margin demonstrates a general upward trend starting from 6.01% in June 2017 to a peak of 17.57% by December 2023. This indicates improving profitability over the period. Initial values from 2017 into early 2018 show moderate margins around 6-7%, which then notably increase from 12.87% in March 2018, maintaining a steady rise and fluctuating slightly but mostly remaining above 13% from mid-2018 onwards. The margin peaks significantly after 2022, reflecting enhanced cost control, pricing strategies, or operational efficiencies.
- Asset Turnover
- Asset Turnover ratios show moderate fluctuations with a downward shift around 2020. Early data from 2017 and 2018 indicate values in the approximate range of 1.4 to 1.5, reflecting efficient use of assets to generate sales. From early 2019, a decline is observable, reaching a low of 0.99 in December 2020, suggesting less efficiency in asset utilization during that period. This ratio begins to recover after 2021, climbing back to levels near 1.3 to 1.4, though not fully regaining the earlier peak efficiency. The fluctuations indicate variable operational efficiency over the course of these years.
- Financial Leverage
- Financial Leverage ratios fluctuate between 1.34 and 1.85 over the timeframe, with some volatility but generally maintaining moderately elevated leverage levels. There is a notable peak at 1.85 in September 2019, implying increased reliance on debt or liabilities relative to equity during that period. Following this peak, leverage dips somewhat into 2020 and remains stable around 1.5 to 1.6 for most of the subsequent years. This pattern suggests a controlled approach to leverage with periodic adjustments, likely aimed at supporting growth while managing financial risk.
- Return on Equity (ROE)
- ROE exhibits a strong growth trajectory from 12.16% in June 2017 to an elevated 34.4% by December 2023. This rise is consistent with increased profitability and efficient capital use. A marked acceleration occurs beginning in 2018, culminating in high values exceeding 25% through most of the following period. From 2021 onward, ROE remains robust, fluctuating in the 26% to 34% range. The pattern indicates enhanced shareholder value generation driven by improvements in profit margins, effective asset utilization, and managed leverage levels.
Five-Component Disaggregation of ROE
Deckers Outdoor Corp., decomposition of ROE (quarterly data)
Based on: 10-Q (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-K (reporting date: 2023-03-31), 10-Q (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-K (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-K (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-K (reporting date: 2020-03-31), 10-Q (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-K (reporting date: 2019-03-31), 10-Q (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-K (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30).
- Tax Burden
- The tax burden ratio, available from the end of 2017 onwards, initially shows moderate values around 0.52 to 0.58, indicating that after-tax profits were about half to slightly more than half of pre-tax income. Starting in mid-2018, the ratio rises significantly, peaking near 0.83, suggesting a relatively lower tax impact during that period. From late 2018 through 2023, the ratio stabilizes mostly in the range of 0.76 to 0.8, indicating consistent after-tax profitability relative to pre-tax earnings over recent quarters.
- Interest Burden
- The interest burden remains very stable and high, close to 1 throughout the observed period starting mid-2017. This level suggests low interest expense relative to operating profit, implying minimal impact from financing costs on earnings before taxes.
- EBIT Margin
- There is a clear upward trend in EBIT margin from mid-2017 to early 2021. The margin increases from about 11.84% to nearly 20%, reflecting improving operating profitability. After a slight dip during early 2022, margins recover and reach a new high above 22% by the end of 2023, indicating enhanced operational efficiency or favorable pricing and cost management.
- Asset Turnover
- Asset turnover ratios demonstrate moderate fluctuation over the period. A decline is observed from around 1.51 in mid-2017 down to a low near 0.99 in late 2020, possibly due to an increase in assets or a decrease in sales efficiency. Thereafter, the ratio recovers somewhat and fluctuates between approximately 1.17 and 1.42 through 2023, indicating a moderate level of asset utilization in generating revenue.
- Financial Leverage
- Financial leverage shows variability between roughly 1.34 and 1.85. Leverage peaks near the end of 2019 and again around mid-2022 but generally stays between 1.5 and 1.7 for most quarters. This trend reflects stable use of debt or other liabilities relative to equity, with no extreme swings, suggesting consistent capital structure management.
- Return on Equity (ROE)
- ROE exhibits a marked increasing trend from the data available in late 2017 through 2023, rising from about 12% to over 34% by the end of 2023. This strong growth is consistent with improvements in operating margins along with relatively stable financial leverage and asset turnover. The rise in ROE signals enhanced shareholder value generation and effective utilization of equity capital over time.
Two-Component Disaggregation of ROA
Deckers Outdoor Corp., decomposition of ROA (quarterly data)
Based on: 10-Q (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-K (reporting date: 2023-03-31), 10-Q (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-K (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-K (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-K (reporting date: 2020-03-31), 10-Q (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-K (reporting date: 2019-03-31), 10-Q (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-K (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30).
- Net Profit Margin Trend
- The net profit margin shows a consistent positive trend beginning from the first recorded value in March 2018 at 6.01%. There is a notable increase through 2018 and 2019, stabilizing around 13% to 15% from 2019 onward. Slight fluctuations occur, with a peak reaching 17.57% in December 2023. Overall, the margin improved significantly, indicating enhanced profitability relative to revenue over the period.
- Asset Turnover Trend
- Asset turnover ratios begin at 1.51 in March 2018 and experience a downward movement through to March 2020, dropping to 0.99. Following this decline, the ratio exhibits recovery and stabilization between 1.17 and 1.38 from mid-2020 onwards, with some variability in quarters. The trend suggests an initial decrease in efficiency in utilizing assets for revenue generation, followed by a moderate recovery and steadiness in subsequent years.
- Return on Assets (ROA) Trend
- Return on assets reflects a strong upward trajectory starting at 9.05% in March 2018, reaching above 16% by the end of 2018. The ROA peaks multiple times above 20% in recent quarters, specifically hitting 21.62% in December 2023. This improvement illustrates enhanced profitability relative to total assets, influenced by both improved net profit margins and effective asset utilization.
- Relationship Between Metrics
- The upward trend in net profit margin combined with fluctuating but recovering asset turnover ratios contributes to the overall increase in ROA. While asset turnover decreased initially, the significant rise and sustained levels in profit margins compensated to lift ROA. The data illustrates that improved profitability per unit of sale has been a major driver of returns, even amidst varying asset efficiency.
Four-Component Disaggregation of ROA
Deckers Outdoor Corp., decomposition of ROA (quarterly data)
Based on: 10-Q (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-K (reporting date: 2023-03-31), 10-Q (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-K (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-K (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-K (reporting date: 2020-03-31), 10-Q (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-K (reporting date: 2019-03-31), 10-Q (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-K (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30).
- Tax Burden
- The Tax Burden ratio shows a notable increase from 0.52 in March 2018 to a peak around 0.83 in December 2018, after which it stabilizes around the 0.77 to 0.80 range. This suggests a significant reduction in tax expenses relative to pre-tax profits during late 2018, followed by a relatively consistent tax burden in subsequent periods.
- Interest Burden
- The Interest Burden ratio remains consistently high, close to or at 1.00 throughout the recorded quarters from March 2018 onwards. This indicates that interest expenses have a minimal impact on pre-tax earnings, reflecting either low levels of interest expense or efficient capital structure management during this period.
- EBIT Margin
- The EBIT Margin exhibits an upward trend overall, increasing from approximately 11.84% in March 2018 to a high of 22.64% by December 2023. There are fluctuations, with periods of minor decline such as in early 2022, but the general trajectory suggests improving operational efficiency or profitability over the analyzed timeframe.
- Asset Turnover
- Asset Turnover fluctuates throughout the period, starting at 1.51 in March 2018 and then declining to a low of 0.99 around December 2020. From that low point, it gradually recovers, reaching around 1.37 by December 2023. These variations indicate changes in the company’s ability to generate revenue from its asset base, with some periods showing less efficient asset utilization.
- Return on Assets (ROA)
- The ROA shows significant variability but generally trends upward. It increased sharply from 9.05% in March 2018 to peaks over 20% in several quarters by the end of the data set, specifically December 2023 at 21.62%. This improvement reflects stronger overall profitability relative to total assets, consistent with improvements noted in EBIT margin and partial recovery in asset turnover.
Disaggregation of Net Profit Margin
Deckers Outdoor Corp., decomposition of net profit margin ratio (quarterly data)
Based on: 10-Q (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-K (reporting date: 2023-03-31), 10-Q (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-K (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-K (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-K (reporting date: 2020-03-31), 10-Q (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-K (reporting date: 2019-03-31), 10-Q (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-K (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30).
- Tax Burden
- The tax burden ratio shows an initial increasing trend starting from 0.52 in March 2018, peaking at 0.83 in December 2018. Following this peak, the ratio generally stabilizes around 0.78 to 0.81, with minor fluctuations. From March 2020 onwards, the tax burden remains relatively consistent, fluctuating narrowly between 0.76 and 0.8, indicating a stabilization in the company's effective tax rate over recent periods.
- Interest Burden
- The interest burden ratio remains remarkably stable throughout the observed periods. Starting around 0.98 in early observations, it increases slightly to 0.99 and eventually reaches a consistent level of 1.0 from March 2022 onwards. This indicates that interest expenses have a minimal or no negative impact on operating income, reflecting either low debt levels or effective interest cost management.
- EBIT Margin
- The EBIT margin demonstrates a clear upward trend from mid-2017 to early 2021, increasing from approximately 11.84% to a peak near 20%. This upward movement illustrates an improvement in operating efficiency or pricing power. After peaking in early 2021, a slight decline is visible through much of 2021 and 2022, with margins dipping to around 16.5% to 18%. However, by the end of 2023, the margin recovers strongly to approximately 22.6%, surpassing previous highs and suggesting renewed operational strength or favorable market conditions.
- Net Profit Margin
- The net profit margin exhibits a significant positive trend starting from about 6% in early 2018 and rising steadily to nearly 15% by early 2021. This improvement aligns with the rising EBIT margin and may reflect better control over costs, higher revenues, or tax efficiencies. During the subsequent period up to early 2023, margins soften slightly but remain above 13%, showing resilience despite potential external challenges. Toward the end of the data series, the net profit margin rebounds to approximately 17.6% in late 2023, indicating an overall enhanced profitability and effective bottom-line management.