Dell Technologies Inc. (NYSE:DELL)

The financial data reveals notable fluctuations in key performance indicators over the analyzed periods. Return on Assets (ROA) exhibits variability, starting at 3.88% in early 2020, declining to 2.63% by early 2021, then improving significantly to 6% in early 2022. Following this peak, ROA decreases again to 2.73% in early 2023 but shows a recovery trend with increases to 3.91% and 5.76% in the subsequent years. This pattern suggests periods of both contraction and growth in asset profitability, with a general positive trend in the most recent years.

Financial Leverage is reported only in early 2021, with an exceptionally high ratio of 49.78. The absence of leverage data in other periods limits the assessment of its trend and impact on financial performance. The extremely high leverage ratio reported could imply significant reliance on debt financing for that period, which might influence risk and return profiles.

Return on Equity (ROE) is available only for early 2021, where it reaches an extraordinarily high figure of 131.1%. This unusually elevated ROE indicates an exceptional return to shareholders during that period, potentially reflective of high profitability, leverage effects, or other extraordinary factors. Lack of data in other periods prevents trend analysis for this metric.

Return on Assets (ROA)

Fluctuates over time with an initial decline from 3.88% to 2.63%, a peak at 6%, a subsequent dip to 2.73%, and a recovery trend toward 5.76%.

Financial Leverage

Reported only once at an unusually high level of 49.78, indicating significant leverage during that period.

Return on Equity (ROE)

Available exclusively for early 2021, with an exceptionally high return of 131.1%, suggesting a period of extraordinary shareholder returns.

The analysis of the financial ratios over the reported periods reveals several noteworthy trends related to profitability, efficiency, and leverage.

Net Profit Margin

This metric exhibits some fluctuations throughout the periods. Starting at 5.01% in early 2020, the margin declined to 3.45% by early 2021, suggesting some pressure on profitability. However, it recovered strongly to 5.5% in early 2022, before experiencing a significant dip to 2.39% in early 2023. The margin then improved to 3.63% and 4.81% in early 2024 and early 2025 respectively, indicating a partial recovery in profit efficiency over the last two years.

Asset Turnover

This ratio shows a progressive increase over the periods analyzed. Beginning at 0.78 in 2020, it slightly decreased to 0.76 in 2021 but then increased substantially to 1.09 in 2022. It continued to rise, reaching 1.14 in 2023, then slightly decreased to 1.08 in 2024, followed by a further increase to 1.20 in 2025. This overall upward trend suggests enhanced efficiency in using assets to generate revenue over time.

Financial Leverage

The available data for financial leverage is limited to a single point in early 2021, recording a ratio of 49.78. Due to the absence of data for other periods, no trend analysis or conclusions about leverage trends can be made.

Return on Equity (ROE)

ROE data is only available for early 2021, showing a remarkably high value of 131.1%. With no other data points for comparison, it is not possible to identify trends or assess the sustainability of this return level.

In summary, the company has demonstrated improving efficiency in asset utilization, as evidenced by rising asset turnover ratios. Profitability, as measured by net profit margin, has shown variability with periods of decline and partial recovery. The financial leverage and ROE data are insufficient for trend analysis, limiting insights into the company’s use of debt and equity returns over time.

Tax Burden

The tax burden ratio demonstrates a declining trend from 0.95 in 2021 to a low of 0.75 in 2023, followed by a gradual recovery to 0.91 by 2025. This indicates a decrease in the proportion of pre-tax income paid as taxes during the early years, with a subsequent increase in later periods.

Interest Burden

The interest burden ratio shows substantial volatility. It starts at a negative value of -0.52 in 2020, improves sharply to 0.59 in 2021, and generally increases to 0.78 by 2025, with slight fluctuations in the intervening years. The upward trend suggests improving ability to cover interest expenses relative to EBIT over time.

EBIT Margin

The EBIT margin exhibits significant variation, increasing from 1.91% in 2020 to a peak of 7.99% in 2022. It then falls to 4.37% in 2023 before recovering to 6.76% in 2025. Overall, the margin indicates an improving operating profitability over the period, despite a noticeable dip after 2022.

Asset Turnover

Asset turnover shows a generally positive and upward trend, moving from 0.78 in 2020 to 1.20 by 2025. There is a slight decrease in 2024 but the overall pattern suggests increasing efficiency in using assets to generate revenue over the years.

Financial Leverage

Financial leverage data is only available for 2021, with a notably high ratio of 49.78. The absence of data from other years prevents analysis of trends or changes in leverage over the period.

Return on Equity (ROE)

Return on equity is reported only in 2021 with an extremely high value of 131.1%. With no data for other years, no trend or further insight can be derived.

The analyzed financial ratios reveal notable trends over the six-year period under review. The net profit margin initially declined from 5.01% in 2020 to 3.45% in 2021, indicating reduced profitability relative to sales. However, it recovered to 5.5% in 2022, followed by a decrease to 2.39% in 2023. Subsequently, the margin increased steadily to reach 4.81% by 2025, reflecting an overall improvement in operational efficiency and profitability after the volatility observed in the middle years.

Asset turnover exhibited relatively stable and improving performance. Starting at 0.78 in 2020, this ratio slightly decreased to 0.76 in 2021 but then experienced a marked increase to 1.09 in 2022. The upward trend continued with 1.14 in 2023 and a minor dip to 1.08 in 2024, before culminating at the highest ratio of 1.2 in 2025. These changes suggest enhanced efficiency in using assets to generate revenue over time.

Return on assets (ROA) showed fluctuations corresponding broadly with net profit margin movements but with greater variability. From 3.88% in 2020, ROA declined to 2.63% in 2021, surged to a peak of 6% in 2022, then dropped sharply to 2.73% in 2023. Following this, ROA climbed steadily, reaching 5.76% in 2025. The fluctuation indicates periods of varying profitability and asset utilization, with an overall improvement in returns on asset investment by the end of the period.

Net Profit Margin

Decreased significantly in 2021, rebounded in 2022, dipped again in 2023, and increased steadily through 2025.

Asset Turnover

Maintained relative stability early on with a slight dip in 2021, followed by consistent improvement peaking in 2025.

Return on Assets (ROA)

Displayed marked volatility, with a sharp rise in 2022, a decline in 2023, and steady recovery to near peak levels by 2025.

Tax Burden

The tax burden ratio fluctuated over the examined periods, starting with a relatively high value in 2021 at 0.95. It declined in the subsequent two years reaching a low of 0.75 in 2023, then recovered gradually to 0.91 by 2025, indicating variability in the effective tax rate impacting profitability after tax.

Interest Burden

The interest burden showed significant volatility, beginning from a negative ratio in 2020 (-0.52), which possibly indicates a net interest gain or an accounting anomaly. It then increased sharply to positive values from 2021 onwards, stabilizing around the 0.7 to 0.8 range from 2022 to 2025, suggesting the company was consistently able to cover interest expenses through operating earnings during these years.

EBIT Margin

The EBIT margin demonstrated overall growth from 1.91% in 2020 to a peak of 7.99% in 2022, followed by a dip to 4.37% in 2023. The margin rebounded thereafter, reaching 6.76% in 2025. This pattern indicates fluctuating operating efficiency and profitability, with a notable decline in 2023 possibly due to increased operating costs or decreased revenues, before a recovery phase.

Asset Turnover

Asset turnover showed a steady upward trend over the periods, beginning at 0.78 in 2020 and increasing to 1.20 by 2025. This indicates an improving efficiency in utilizing assets to generate revenue, reflecting potentially enhanced operational management or strategic asset deployment.

Return on Assets (ROA)

ROA displayed a variable trajectory, declining from 3.88% in 2020 to 2.63% in 2021, then increasing sharply to 6% in 2022. The metric dipped again to 2.73% in 2023 but experienced a consistent rise thereafter reaching 5.76% in 2025. This variability aligns with fluctuations in profitability margins and asset efficiency, suggesting periods of both challenges and recovery in overall asset profitability.

The financial data reveals several noteworthy trends in profitability and cost management ratios over the analyzed periods.

Tax Burden

The tax burden ratio demonstrates a general declining trend from 0.95 in 2021 to a low of 0.75 in 2023, followed by a recovery to 0.91 in 2025. This indicates that the company experienced a decreasing tax retention impact on earnings up to 2023, implying an increasing effective tax rate or greater tax expense, before improving efficiency or tax benefits led to a higher retention ratio in the latter years.

Interest Burden

This ratio starts negatively at -0.52 in 2020, reflecting possibly high interest costs or losses impacting operating income. From 2021 onward, there is a strong positive adjustment, with values improving steadily from 0.59 to 0.78 by 2025. The positive and rising interest burden ratios suggest enhanced management of interest expenses relative to operating earnings, indicating better control over financial leverage or lower interest costs.

EBIT Margin

The EBIT margin rises sharply from 1.91% in 2020 to a peak of 7.99% in 2022, followed by a drop to 4.37% in 2023, and then recovering somewhat to 6.76% in 2025. This pattern reflects initial improvement in operating profitability, a significant setback in 2023, and a subsequent partial rebound. Such volatility could be driven by operational challenges, market conditions, or cost structure changes.

Net Profit Margin

The net profit margin exhibits fluctuations, peaking at 5.5% in 2022 before declining sharply to 2.39% in 2023, then gradually improving to 4.81% in 2025. This trend mirrors the EBIT margin's pattern but shows greater sensitivity to taxes, interest, and other non-operating factors affecting final profitability.

Overall, the data indicates that while operating earnings improved significantly during the early years, challenges in 2023 caused both operating and net profitability to decline. Subsequent years show recovery efforts with improved cost and tax management, as seen in the tax and interest burden ratios, supporting a strengthening net profit margin thereafter.