Stock Analysis on Net
Stock Analysis on Net
Microsoft Excel LibreOffice Calc

General Electric Co. (NYSE:GE)

Return on Capital (ROC)

Advanced level

Return on capital (ROC) is after tax rate of return on net business assets. ROIC is unaffected by changes in interest rates or company’s debt and equity structure. It measures business productivity performance.


Return on Invested Capital (ROIC)

General Electric Co., ROIC calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
Selected Financial Data (US$ in millions)
Net operating profit after taxes (NOPAT)1 4,395  1,994  (19,486) (7,006) 13,899 
Invested capital2 64,102  78,101  135,167  193,260  191,946 
Performance Ratio
ROIC3 6.86% 2.55% -14.42% -3.63% 7.24%
Benchmarks
ROIC, Competitors4
3M Co. 14.91% 12.09% 17.81% 16.68% 17.55%
Honeywell International Inc. 10.85% 15.49% 18.15% 10.39% 13.51%

Based on: 10-K (filing date: 2021-02-12), 10-K (filing date: 2020-02-24), 10-K (filing date: 2019-02-26), 10-K (filing date: 2018-02-23), 10-K (filing date: 2017-02-24).

1 NOPAT. See details »

2 Invested capital. See details »

3 2020 Calculation
ROIC = 100 × NOPAT ÷ Invested capital
= 100 × 4,395 ÷ 64,102 = 6.86%

4 Click competitor name to see calculations.

Performance ratio Description The company
ROIC A measure of the periodic, after tax, cash-on-cash yield earned in the business. General Electric Co.’s ROIC improved from 2018 to 2019 and from 2019 to 2020.

Decomposition of ROIC

General Electric Co., decomposition of ROIC

Microsoft Excel LibreOffice Calc
ROIC = OPM1 × TO2 × 1 – CTR3
Dec 31, 2020 6.86% = 9.91% × 1.14 × 60.72%
Dec 31, 2019 2.55% = 5.13% × 1.12 × 44.43%
Dec 31, 2018 -14.42% = -13.64% × 0.84 × 100.00%
Dec 31, 2017 -3.63% = -3.14% × 0.59 × 100.00%
Dec 31, 2016 7.24% = 13.01% × 0.58 × 96.80%

Based on: 10-K (filing date: 2021-02-12), 10-K (filing date: 2020-02-24), 10-K (filing date: 2019-02-26), 10-K (filing date: 2018-02-23), 10-K (filing date: 2017-02-24).

1 Operating profit margin (OPM). See calculations »

2 Turnover of capital (TO). See calculations »

3 Effective cash tax rate (CTR). See calculations »

The primary reason for the increase in return on invested capital (ROIC) over 2020 year is the increase in profitability measured by operating profit margin (OPM) ratio.


Operating Profit Margin (OPM)

General Electric Co., OPM calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
Selected Financial Data (US$ in millions)
Net operating profit after taxes (NOPAT)1 4,395  1,994  (19,486) (7,006) 13,899 
Add: Cash operating taxes2 2,843  2,494  4,004  3,450  460 
Net operating profit before taxes (NOPBT) 7,238  4,488  (15,482) (3,556) 14,359 
 
Sales of goods and services 73,022  87,487  113,544  113,192  110,390 
Profitability Ratio
OPM3 9.91% 5.13% -13.64% -3.14% 13.01%
Benchmarks
OPM, Competitors4
3M Co. 22.89% 18.87% 22.64% 25.01% 23.97%
Honeywell International Inc. 20.26% 21.22% 20.84% 17.60% 17.75%

Based on: 10-K (filing date: 2021-02-12), 10-K (filing date: 2020-02-24), 10-K (filing date: 2019-02-26), 10-K (filing date: 2018-02-23), 10-K (filing date: 2017-02-24).

1 NOPAT. See details »

2 Cash operating taxes. See details »

3 2020 Calculation
OPM = 100 × NOPBT ÷ Sales of goods and services
= 100 × 7,238 ÷ 73,022 = 9.91%

4 Click competitor name to see calculations.

Profitability ratio Description The company
OPM The operating profit margin (OPM) is the ratio of pretax economic earnings, or NOPBT, to sales. General Electric Co.’s OPM improved from 2018 to 2019 and from 2019 to 2020.

Turnover of Capital (TO)

General Electric Co., TO calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
Selected Financial Data (US$ in millions)
Sales of goods and services 73,022  87,487  113,544  113,192  110,390 
Invested capital1 64,102  78,101  135,167  193,260  191,946 
Efficiency Ratio
TO2 1.14 1.12 0.84 0.59 0.58
Benchmarks
TO, Competitors3
3M Co. 0.83 0.83 1.04 0.98 1.03
Honeywell International Inc. 0.67 0.86 1.02 1.01 0.99

Based on: 10-K (filing date: 2021-02-12), 10-K (filing date: 2020-02-24), 10-K (filing date: 2019-02-26), 10-K (filing date: 2018-02-23), 10-K (filing date: 2017-02-24).

1 Invested capital. See details »

2 2020 Calculation
TO = Sales of goods and services ÷ Invested capital
= 73,022 ÷ 64,102 = 1.14

3 Click competitor name to see calculations.

Efficiency ratio Description The company
TO The turnover of capital (TO) is the ratio of sales to invested capital. Capital turnover is a function of the efficiency of working capital management and of net fixed assets. General Electric Co.’s TO improved from 2018 to 2019 and from 2019 to 2020.

Effective Cash Tax Rate (CTR)

General Electric Co., CTR calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
Selected Financial Data (US$ in millions)
Net operating profit after taxes (NOPAT)1 4,395  1,994  (19,486) (7,006) 13,899 
Add: Cash operating taxes2 2,843  2,494  4,004  3,450  460 
Net operating profit before taxes (NOPBT) 7,238  4,488  (15,482) (3,556) 14,359 
Tax Rate
CTR3 39.28% 55.57% 3.20%
Benchmarks
CTR, Competitors4
3M Co. 21.47% 22.38% 24.34% 31.90% 28.57%
Honeywell International Inc. 20.56% 15.05% 14.23% 41.68% 23.02%

Based on: 10-K (filing date: 2021-02-12), 10-K (filing date: 2020-02-24), 10-K (filing date: 2019-02-26), 10-K (filing date: 2018-02-23), 10-K (filing date: 2017-02-24).

1 NOPAT. See details »

2 Cash operating taxes. See details »

3 2020 Calculation
CTR = 100 × Cash operating taxes ÷ NOPBT
= 100 × 2,843 ÷ 7,238 = 39.28%

4 Click competitor name to see calculations.