Delta Air Lines Inc. (NYSE:DAL)

Return on Assets (ROA)

The return on assets exhibits a generally stable performance from 2017 to 2019, with values around 6.53% to 7.39%. However, a significant decline occurs in 2020, plunging to -17.2%, indicating substantial losses or asset inefficiency during that year. By 2021, the ROA improves markedly to 0.39%, signaling a partial recovery though remaining considerably low compared to the pre-2020 period.

Financial Leverage

Financial leverage shows a moderate increase from 3.83 in 2017 to 4.4 in 2018, followed by a slight decrease to 4.2 in 2019. In 2020, there is an extraordinary spike to 46.93, suggesting a drastic rise in debt relative to equity, likely reflecting financial distress or aggressive borrowing. In 2021, leverage decreases to 18.64, which, while still elevated, indicates some deleveraging or capital restructuring.

Return on Equity (ROE)

Return on equity improves from 25.72% in 2017 to 31.04% in 2019, showcasing increasing profitability and efficient use of equity. The year 2020 presents a dramatic downturn to -807.37%, revealing an extreme loss situation that heavily eroded equity value. By 2021, ROE partially recovers to 7.2%, which is a positive sign but remains substantially below the pre-2020 profitability levels.

The analysis of the annual financial data reveals significant fluctuations over the observed periods, especially in 2020 and 2021, which appear to deviate markedly from prior years' trends.

Net Profit Margin

The net profit margin exhibited a generally positive and slightly increasing trend from 2017 through 2019, rising from 8.67% to 10.14%. This indicates improving profitability relative to revenue during these years. However, in 2020, there was a drastic and exceptional decline to -72.45%, reflecting a substantial loss possibly connected to extraordinary events affecting the company's operations. By 2021, the margin rebounded sharply to a modest positive value of 0.94%, suggesting some recovery though profitability remained significantly below pre-2020 levels.

Asset Turnover

Asset turnover demonstrated a slight downward trend from 0.77 in 2017 to 0.73 in 2019, indicating a minor reduction in efficiency in using assets to generate revenue. The year 2020 showed a steep drop to 0.24, consistent with the impact evident in profitability metrics. In 2021, the ratio improved to 0.41 but remained below earlier years, signaling partial recovery in asset utilization efficiency.

Financial Leverage

Financial leverage remained relatively stable around 3.8 to 4.4 from 2017 to 2019, reflecting consistent use of debt relative to equity. A dramatic spike occurred in 2020, with leverage surging to 46.93, indicative of a substantial increase in liabilities or a steep reduction in equity, possibly due to financial distress or significant recapitalization. The 2021 figure decreased to 18.64, indicating some deleveraging but still substantially elevated compared to the pre-2020 period.

Return on Equity (ROE)

ROE displayed steady improvement from 25.72% in 2017 to 31.04% in 2019, demonstrating effective generation of earnings relative to shareholder equity. In 2020, ROE collapsed to -807.37%, a reflection of extreme negative profitability combined with extreme financial leverage effects. The recovery in 2021 to 7.2% signifies a partial normalization but indicates ongoing challenges in profitability and equity returns compared to historical averages.

In summary, the data indicate a strong operational and financial performance leading up to 2019, followed by a severe disruption in 2020 likely reflecting extraordinary adverse conditions. The partial recovery in 2021 across all analyzed financial metrics suggests improvement, yet key ratios remain below historical norms, and elevated leverage points to potential financial risk or restructuring activities ongoing within the company.

Tax Burden

The tax burden ratio increased from 0.63 in 2017 to 0.77 in 2019, indicating a growing portion of earnings retained after taxes during this period. Data for 2020 is missing, but it decreased to 0.7 in 2021, suggesting a slight reduction in efficiency related to tax expenses compared to previous years.

Interest Burden

The interest burden ratio remained relatively stable around 0.94 to 0.95 from 2017 to 2019, reflecting consistent interest expense management. However, a significant decline to 0.24 in 2021 indicates much higher interest expenses or a substantial change in earnings before interest and taxes, affecting profitability.

EBIT Margin

The EBIT margin showed a decreasing trend from 14.78% in 2017 to 12.29% in 2018, slightly recovering to 13.83% in 2019. A drastic negative margin of -85.74% appeared in 2020, highlighting a severe operating loss likely due to extraordinary circumstances, followed by a partial recovery to 5.61% in 2021, which remains below pre-2020 levels.

Asset Turnover

Asset turnover declined gradually from 0.77 in 2017 to 0.73 in 2019, indicating a slight reduction in asset utilization efficiency. A sharp drop to 0.24 in 2020 reflects a substantial decrease in revenue generation from assets, improving modestly to 0.41 in 2021 but still well below earlier levels.

Financial Leverage

Financial leverage increased steadily from 3.83 in 2017 to 4.4 in 2018, then slightly declined to 4.2 in 2019. In 2020, leverage surged dramatically to 46.93, signaling a significant increase in debt or financial obligations relative to equity, before decreasing to 18.64 in 2021, which remains substantially elevated compared to pre-2020 years.

Return on Equity (ROE)

ROE increased consistently from 25.72% in 2017 to 31.04% in 2019, showing improved profitability and shareholder value. In 2020, ROE plummeted to -807.37%, coinciding with severe losses and financial strain. It rebounded to 7.2% in 2021 but remained significantly below historical levels, indicating ongoing challenges in achieving prior profitability.

Net Profit Margin

The net profit margin remained relatively stable and positive from 2017 to 2019, with values increasing slightly from 8.67% to 10.14%. However, there was a significant and abrupt decline in 2020, resulting in a large negative margin of -72.45%. This suggests a severe profitability challenge, likely due to extraordinary circumstances during that year. In 2021, the net profit margin showed a recovery but remained very low at 0.94%, indicating that profitability had not yet returned to pre-2020 levels.

Asset Turnover

Asset turnover displayed a gradual decreasing trend from 0.77 in 2017 to 0.73 in 2019, implying a slight decline in the efficiency with which assets were used to generate revenue. A sharp drop occurred in 2020 to 0.24, reflecting a substantial reduction in operational activity or sales volume relative to assets. Partial recovery was observed in 2021 with an increase to 0.41, though this still remained well below earlier years, indicating continuing challenges in asset utilization.

Return on Assets (ROA)

The return on assets closely mirrored the patterns seen in net profit margin and asset turnover. It showed moderate fluctuations from 6.71% in 2017 to 7.39% in 2019, reflecting steady profitability and asset efficiency. The ROA plummeted sharply in 2020 to -17.2%, indicating a significant loss generated relative to the asset base during the year. In 2021, ROA improved to 0.39% but remained minimal, reinforcing the indication of ongoing recovery efforts and subdued profitability.

The analyzed financial data reveals several notable trends over the five-year period, highlighting fluctuations in profitability, operational efficiency, and the impact of extraordinary circumstances.

Tax Burden

The tax burden ratio exhibited a generally stable yet slightly fluctuating pattern. It increased from 0.63 in 2017 to 0.77 in 2019, indicating a higher proportion of earnings retained after taxes in this period. However, data for 2020 is missing, and the ratio decreased to 0.7 in 2021, suggesting a moderate reduction in the effective tax rate or changes in profitability impacting taxable income.

Interest Burden

This ratio remained steady at 0.94-0.95 from 2017 through 2019, indicating consistent interest expense relative to earnings before interest and taxes (EBIT). However, there is a sharp decline to 0.24 in 2021, after missing data in 2020. This significant decrease suggests a substantial reduction in interest expenses or improvement in earnings before interest, possibly driven by debt restructuring or changes in financial costs.

EBIT Margin

The EBIT margin showed a declining trend from 14.78% in 2017 to 12.29% in 2018, followed by a slight recovery to 13.83% in 2019. There was an extreme drop to -85.74% in 2020 reflecting severe operational losses, likely linked to extraordinary circumstances impacting revenue or costs substantially. The margin partially recovered to 5.61% in 2021, but remained well below pre-2020 levels.

Asset Turnover

Asset turnover gradually decreased from 0.77 in 2017 to 0.73 in 2019, indicating a small decline in how efficiently assets generated revenue. A sharp decline to 0.24 in 2020 suggests significant underutilization of assets during that year. There was a partial recovery to 0.41 in 2021, yet efficiency remained substantially weaker compared to earlier years.

Return on Assets (ROA)

The ROA mirrored the EBIT margin trend, with a slight decrease from 6.71% in 2017 to 6.53% in 2018, before improving to 7.39% in 2019. The ROA dramatically turned negative at -17.2% in 2020, reflecting losses and poor asset utilization during that period. It rebounded modestly to 0.39% in 2021, indicating minimal profitability relative to asset base but still far below earlier performance levels.

Overall, the data reveals a period of stable financial performance from 2017 to 2019, followed by a sharp and severe decline in 2020 across profitability and efficiency metrics, likely due to extraordinary challenges. Partial recoveries in 2021 are evident but do not restore performance to pre-2020 standards. Notably, significant improvements in interest burden suggest possible financial restructuring or cost management efforts during the disruption period.

Over the evaluated period, there are notable fluctuations and trends across the key financial ratios.

Tax Burden

The tax burden ratio generally increased from 0.63 in 2017 to around 0.77 in 2019, indicating a rising proportion of earnings retained after tax. A sharp decrease is seen in 2021 to 0.7 after missing data for 2020, suggesting some recovery but still below earlier peak levels.

Interest Burden

This ratio remained relatively stable near 0.94-0.95 from 2017 through 2019, indicating consistent operating earnings before interest and taxes relative to earnings before taxes. However, there is a significant drop to 0.24 in 2021, following missing data in 2020, which points to a substantial increase in interest expenses or decreased operating income in that year.

EBIT Margin

The EBIT margin saw a decline from 14.78% in 2017 to 12.29% in 2018 and a slight rebound to 13.83% in 2019. A dramatic negative spike occurred in 2020, dropping to -85.74%, which indicates severe operational losses, likely linked to extraordinary circumstances. By 2021, the margin improved markedly to 5.61%, although it remained significantly below pre-2020 levels.

Net Profit Margin

The net profit margin followed a stable increasing trend from 8.67% in 2017 to 10.14% in 2019, reflecting improved profitability. In 2020, a steep decline to -72.45% occurred, mirroring the trend in EBIT margin and signaling heavy net losses. The margin partially recovered to 0.94% in 2021 but did not return to profitability seen in earlier years.

Overall, the data exhibit a period of stable or improving profitability through 2019, followed by a pronounced downturn in 2020, likely driven by adverse factors affecting operating and net profitability. Partial recovery is observable in 2021, although profitability remains below prior levels. The sharp decline in interest burden in 2021 may indicate increasing financial strain or restructuring of debt obligations.