Ford Motor Co. (NYSE:F)

Net Operating Profit After Taxes (NOPAT)

The NOPAT values exhibit significant fluctuation over the observed periods. Starting from a negative figure in 2020, there is a substantial increase in 2021, reaching a peak of 11,380 million US$. This is followed by a sharp decline in 2022 to 2,786 million US$, remaining relatively stable in 2023 at 3,005 million US$, and then rising again in 2024 to 6,733 million US$. This indicates a period of recovery and variable profitability after the initial loss.

Invested Capital

The invested capital shows a generally increasing trend, starting from 170,559 million US$ in 2020, decreasing slightly in 2021 to 160,105 million US$, then gradually increasing over the subsequent years to 164,218 million US$ in 2022, 173,985 million US$ in 2023, and reaching 186,730 million US$ in 2024. This suggests progressive capital deployment with a minor dip early in the period.

Return on Invested Capital (ROIC)

The ROIC demonstrates a recovery trajectory from a negative return of -0.25% in 2020 to a marked improvement in 2021 at 7.11%. However, this is followed by a significant reduction in 2022 to 1.7% and a slight increase to 1.73% in 2023. The ratio improves again in 2024 to 3.61%, indicating enhanced efficiency in generating returns on invested capital, though still below the 2021 peak.

Summary Insights

The data reveals a pattern of initial financial distress in 2020, followed by a strong rebound in profitability and returns in 2021. Despite subsequent declines in 2022 and 2023, both profitability and returns show signs of recovery in 2024. Invested capital has been steadily increasing since 2021, suggesting ongoing investment despite fluctuations in profitability metrics. Overall, there is an observable improvement in financial performance and capital efficiency towards the end of the period under review.

The financial data reveals several important trends across the periods examined.

Operating Profit Margin (OPM)

The operating profit margin showed a significant improvement from a minimal 0.22% in 2020 to a peak of 8.31% in 2021. After this peak, it declined sharply to 3.67% in 2022 and further decreased to 2.56% in 2023. In 2024, it rebounded to 4.41%, indicating some recovery in operational profitability but still well below the 2021 peak.

Turnover of Capital (TO)

This ratio demonstrated a steady upward trend from 0.68 in 2020 to 0.79 in 2021, then continued rising to 0.91 in 2022 and peaked at 0.96 in 2023. The slight decrease to 0.93 in 2024 suggests a stabilization of capital efficiency near its highest levels observed during this period.

Effective Cash Tax Rate (1 – CTR)

The effective cash tax rate experienced extreme volatility. It started at a negative -169.76% in 2020, shifting dramatically to a very high positive level of 108.2% in 2021. The rate decreased to 50.85% in 2022 before increasing again to 70.71% in 2023 and 88% in 2024. These fluctuations could indicate irregular tax impacts or timing differences affecting cash taxes payable and refunds.

Return on Invested Capital (ROIC)

The ROIC moved from a negative return of -0.25% in 2020 to a strong positive of 7.11% in 2021, reflecting improved investment efficiency. This was followed by a decline to 1.7% in 2022 and little change to 1.73% in 2023. A moderate recovery occurred in 2024 with ROIC rising to 3.61%, though it remained significantly lower than the 2021 high.

Overall, the data shows a pattern of strong performance improvement in 2021 followed by declines in profitability and returns through 2022 and 2023, with partial recoveries in 2024. Efficiency in capital turnover increased steadily, suggesting better asset utilization despite fluctuations in profit margins and returns. The erratic cash tax rate warrants further analysis to understand its impact on overall financial performance.

Net Operating Profit Before Taxes (NOPBT)

The NOPBT values reveal significant fluctuations over the observed period. Starting from a low of 252 million US dollars in 2020, there was a remarkable surge to 10,518 million in 2021, indicating a strong recovery or operational improvement. This peak was followed by a decline to 5,479 million in 2022 and further down to 4,250 million in 2023, before rebounding to 7,650 million in 2024. The overall trend shows volatility with a major peak in 2021 and signs of partial recovery in 2024.

Adjusted Company Revenues Excluding Ford Credit

Revenues demonstrated a consistent upward trajectory throughout the five years. The figures increased steadily from 116,379 million US dollars in 2020 to 173,381 million in 2024. This steady growth illustrates the company's ability to expand its revenue base without relying on Ford Credit, reflecting an overall positive trend in sales or service activities excluding financial services.

Operating Profit Margin (OPM)

The OPM values display a volatile yet recovering pattern. In 2020, the margin was very low at 0.22%, followed by a sharp increase to 8.31% in 2021. Subsequently, the margin dropped to 3.67% in 2022 and further to 2.56% in 2023, before improving again to 4.41% in 2024. These fluctuations suggest variations in operating efficiency or cost management, with profitability peaking in 2021 and showing partial recovery in the latest period.

Revenues Trend

The adjusted company revenues excluding Ford Credit have demonstrated consistent growth over the five-year period. Starting at $116,379 million in 2020, revenues increased annually, reaching $173,381 million by 2024. This marks a significant upward trend, indicating strong sales performance or expanded operations.

Invested Capital Trend

Invested capital showed some fluctuation but a general upward movement. It started at $170,559 million in 2020, declined slightly to $160,105 million in 2021, and then increased steadily over the next three years to $186,730 million in 2024. This suggests ongoing capital investments or asset base expansion after the initial dip.

Turnover of Capital (TO) Ratio Trend

The turnover of capital ratio, which measures efficiency in using invested capital to generate revenues, improved notably from 0.68 in 2020 to a peak of 0.96 in 2023. However, in 2024, this ratio slightly declined to 0.93. Overall, the ratio’s rising trend until 2023 reflects improved capital utilization, although the marginal decrease in 2024 may indicate a slight reduction in operational efficiency or increased capital base outpacing revenue growth.

Summary of Relationship Between Metrics

The data shows that while invested capital increased steadily from 2021 onward, revenues grew at a somewhat faster pace, which contributed to the improvement in the turnover of capital ratio. The slight decline in this ratio in 2024, despite increased revenue, may highlight the need for close monitoring of capital deployment relative to revenue generation going forward.

Cash Operating Taxes

The cash operating taxes exhibited notable volatility over the observed periods. Initially, a positive cash outflow of 680 million USD was recorded in 2020, followed by a significant negative amount of -862 million USD in 2021, indicating a possible tax refund or adjustment. The figure then surged to 2,693 million USD in 2022, before declining to 1,245 million USD in 2023 and further to 918 million USD in 2024. This pattern suggests fluctuations in tax payments with a peak in 2022, followed by a gradual reduction over the succeeding years.

Net Operating Profit Before Taxes (NOPBT)

NOPBT showed a pronounced increase from 252 million USD in 2020 to a peak of 10,518 million USD in 2021, marking a substantial improvement in operational profitability. Subsequently, the profit decreased to 5,479 million USD in 2022 and further declined to 4,250 million USD in 2023. A rebound was observed in 2024, with NOPBT rising again to 7,650 million USD. This suggests a peak in profitability in 2021, followed by a downturn over the next two years, and then partial recovery.

Effective Cash Tax Rate (CTR)

The effective cash tax rate fluctuated drastically during the period. The rate was extraordinarily high at 269.76% in 2020, which could indicate unusual tax circumstances or adjustments relative to operating profit. In 2021, the rate turned negative (-8.2%), suggesting tax benefits or refunds exceeding tax liabilities. The rate normalized to 49.15% in 2022, then improved to 29.29% in 2023 and further declined to 12% in 2024. This downward trend in the effective tax rate after 2022 suggests increasing tax efficiency or changes in the tax environment leading to reduced tax burden relative to operating profit.