Analysis of Profitability Ratios
Quarterly Data
Profitability ratios measure the company ability to generate profitable sales from its resources (assets).
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- Balance Sheet: Assets
- Cash Flow Statement
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Long-term (Investment) Activity Ratios
- Enterprise Value to FCFF (EV/FCFF)
- Dividend Discount Model (DDM)
- Selected Financial Data since 2005
- Net Profit Margin since 2005
- Return on Equity (ROE) since 2005
- Return on Assets (ROA) since 2005
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Profitability Ratios (Summary)
Hess Corp., profitability ratios (quarterly data)
Based on: 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
The analysis of the quarterly financial ratios over the examined periods reveals significant fluctuations in the company’s profitability and efficiency metrics, indicating varying operational and financial performance trends.
- Operating Profit Margin
- The operating profit margin displayed a strong positive trend from March 2019 to December 2019, ranging between approximately 9.25% and 13.68%. However, there was a dramatic decline starting in March 2020 through December 2020, with margins turning deeply negative and reaching lows around -51%. This downturn corresponds with a period of operational challenges. Subsequently, from March 2021 onwards, the margin improved markedly, moving back into positive territory and increasing steadily to a peak near 35.67% by December 2022, followed by a slight decline but remaining robust above 29% through September 2023.
- Net Profit Margin
- The net profit margin mirrored the operating margin’s trends but demonstrated even greater volatility. Initially negative, with values near zero or slightly below in early 2019, it sharply deteriorated starting in early 2020, reaching lows close to -66% during the latter half of 2020. Recovery began in early 2021, with margins improving through 2022 and into 2023, surpassing positive 18% by the end of 2022. Despite a small dip thereafter, net margins remained above 13%, indicating a notable turnaround in overall profitability.
- Return on Equity (ROE)
- The ROE was negative in all quarters before 2021, worsening significantly during 2020 to levels below -50%, reflecting substantial losses relative to shareholders' equity. Starting in March 2021, ROE showed a recovery trajectory similar to net profit margin, moving from negative into positive territory by the third quarter of 2021. The peak of over 26.6% in late 2022 suggests a rebound in shareholder value creation. Thereafter, a moderate decline was observed, with ROE settling around 17% by the third quarter of 2023.
- Return on Assets (ROA)
- The ROA followed a comparable pattern to ROE but with lower absolute values, consistent with the broader asset base. Initially slightly negative to marginally negative through 2019, ROA declined sharply during 2020 reaching approximately -17%. From early 2021 onwards, there was a gradual recovery, with ROA crossing into positive values in mid-2021 and peaking near 9.66% by December 2022. This metric experienced a moderate decline afterwards, stabilizing around 6.3% by the third quarter of 2023, indicating a recovery in asset utilization efficiency but at a less pronounced rate than equity returns.
Overall, the data depicts a period of significant hardship during 2020, with operating difficulties and substantial losses reflected across all key profitability ratios. Starting in 2021, a pronounced recovery phase ensued, with the company returning to profitability and improving returns on equity and assets through 2022 and maintaining generally strong margins into 2023. The trends suggest effective management actions or favorable market conditions post-2020, enabling the restoration of financial performance and operational efficiency.
Return on Sales
Return on Investment
Operating Profit Margin
Hess Corp., operating profit margin calculation (quarterly data)
| Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||
| Income (loss) before interest and income taxes | |||||||||||||||||||||||||
| Sales and other operating revenues | |||||||||||||||||||||||||
| Profitability Ratio | |||||||||||||||||||||||||
| Operating profit margin1 | |||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||
| Operating Profit Margin, Competitors2 | |||||||||||||||||||||||||
| Chevron Corp. | |||||||||||||||||||||||||
| ConocoPhillips | |||||||||||||||||||||||||
| Exxon Mobil Corp. | |||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q3 2023 Calculation
Operating profit margin = 100
× (Income (loss) before interest and income taxesQ3 2023
+ Income (loss) before interest and income taxesQ2 2023
+ Income (loss) before interest and income taxesQ1 2023
+ Income (loss) before interest and income taxesQ4 2022)
÷ (Sales and other operating revenuesQ3 2023
+ Sales and other operating revenuesQ2 2023
+ Sales and other operating revenuesQ1 2023
+ Sales and other operating revenuesQ4 2022)
= 100 × ( + + + )
÷ ( + + + )
=
2 Click competitor name to see calculations.
The financial performance over the quarterly periods exhibits significant fluctuations, reflecting varying operational efficiencies and market conditions.
- Income Before Interest and Income Taxes
- The income before interest and income taxes displayed a downward trend starting in early 2020, plunging to significant losses in the first and second quarters of 2020. This unfavorable performance was followed by gradual recovery and positive growth through 2021 and 2022. Notably, the income peaked in mid-2022 before showing slight volatility but remaining positive towards late 2023.
- Sales and Other Operating Revenues
- Revenues experienced a decline during the early quarters of 2020, coinciding with the onset of the losses noted above. From mid-2020 onward, there was a consistent upward trajectory in sales, reaching a peak in the third quarter of 2022. Although a mild contraction occurred in early 2023, revenues maintained a robust level compared to the depressed figures observed during 2020.
- Operating Profit Margin
- The operating profit margin sharply deteriorated into negative territory during the first half of 2020, reaching margins below -50%, reflecting operational challenges and possibly adverse external factors. Starting from late 2020, there was a marked improvement, with the margin transitioning back to positive figures in 2021, followed by steady enhancements into 2022. The margins stabilized at strong double-digit percentages through 2022 and into 2023, indicating improved operational efficiency and profitability despite minor fluctuations.
Overall, the data highlights a period of significant financial stress during early 2020, followed by a sustained recovery period. The growth in revenues and margins post-2020 suggests effective management responses and potentially improved market conditions. Nonetheless, some variability remains in income and margins, indicating that while performance has strengthened considerably, the environment continues to present challenges.
Net Profit Margin
Hess Corp., net profit margin calculation (quarterly data)
| Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||
| Net income (loss) attributable to Hess Corporation | |||||||||||||||||||||||||
| Sales and other operating revenues | |||||||||||||||||||||||||
| Profitability Ratio | |||||||||||||||||||||||||
| Net profit margin1 | |||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||
| Net Profit Margin, Competitors2 | |||||||||||||||||||||||||
| Chevron Corp. | |||||||||||||||||||||||||
| ConocoPhillips | |||||||||||||||||||||||||
| Exxon Mobil Corp. | |||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q3 2023 Calculation
Net profit margin = 100
× (Net income (loss) attributable to Hess CorporationQ3 2023
+ Net income (loss) attributable to Hess CorporationQ2 2023
+ Net income (loss) attributable to Hess CorporationQ1 2023
+ Net income (loss) attributable to Hess CorporationQ4 2022)
÷ (Sales and other operating revenuesQ3 2023
+ Sales and other operating revenuesQ2 2023
+ Sales and other operating revenuesQ1 2023
+ Sales and other operating revenuesQ4 2022)
= 100 × ( + + + )
÷ ( + + + )
=
2 Click competitor name to see calculations.
The financial data reveals significant fluctuations in net income, revenues, and net profit margins over the examined periods. The overall trend suggests a period of volatility followed by strong recovery and improved profitability.
- Net Income (Loss) Attributable to Hess Corporation
- Net income exhibited substantial variability across the quarters. Initially, there were small losses and moderate gains, with a pronounced decline starting in early 2020, reaching large negative values, particularly in the first quarter of 2020 (-$2,433 million). This decline continued through the end of 2020, reflecting a challenging operational environment. Beginning in 2021, the net income started to recover, turning positive by the end of the year and continuing an upward trajectory through 2022. The first three quarters of 2023 indicate fluctuations, but net income remains positive, although reduced in the second and third quarters.
- Sales and Other Operating Revenues
- Revenues showed a cyclical pattern with a slight decline in early 2020, reaching a low in the second quarter of 2020 ($833 million). Subsequent quarters saw a robust rebound, with revenues generally increasing throughout 2021 and peaking in late 2022 above $3 billion. Early 2023 experienced a moderation in revenue levels, though figures remained relatively strong compared to the mid-2020 trough.
- Net Profit Margin
- The net profit margin mirrors the net income pattern, with negative margins during much of 2019 and a dramatic deterioration in 2020, reaching lows of around -66%. This suggests high losses relative to sales during that period. From 2021 onwards, margins improved markedly, becoming positive and reaching levels above 17% in late 2022. Margins in 2023 show a slight reduction compared to peak profitability in 2022 but remain considerably healthier than the prior downturn years.
In summary, the data reflects a severe financial downturn in 2020, likely linked to external economic or industry-specific stressors, followed by a period of recovery and strengthened profitability. Revenue growth and improving profit margins after mid-2020 indicate enhanced operational performance and cost management. Despite some recent fluctuations in net income and margins in 2023, the financial position remains significantly improved compared to the steep losses observed in 2020.
Return on Equity (ROE)
Hess Corp., ROE calculation (quarterly data)
| Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||
| Net income (loss) attributable to Hess Corporation | |||||||||||||||||||||||||
| Total Hess Corporation stockholders’ equity | |||||||||||||||||||||||||
| Profitability Ratio | |||||||||||||||||||||||||
| ROE1 | |||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||
| ROE, Competitors2 | |||||||||||||||||||||||||
| Chevron Corp. | |||||||||||||||||||||||||
| ConocoPhillips | |||||||||||||||||||||||||
| Exxon Mobil Corp. | |||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q3 2023 Calculation
ROE = 100
× (Net income (loss) attributable to Hess CorporationQ3 2023
+ Net income (loss) attributable to Hess CorporationQ2 2023
+ Net income (loss) attributable to Hess CorporationQ1 2023
+ Net income (loss) attributable to Hess CorporationQ4 2022)
÷ Total Hess Corporation stockholders’ equity
= 100 × ( + + + )
÷ =
2 Click competitor name to see calculations.
- Net Income (Loss) Attributable to the Corporation
- The net income exhibits a pronounced volatility throughout the observed periods, ranging from positive to significant negative values. During 2019, the company encountered substantial net losses in the latter half, culminating in a notable downturn by December 2019. The beginning of 2020 marked a steep decline, with a peak loss in the first quarter followed by a reduction in losses over the subsequent quarters. From early 2021 onward, the company demonstrated a recovery trend, showing positive net income in multiple quarters. This recovery became more consistent and pronounced through 2022 and into 2023, with several quarters reporting net income figures exceeding prior positive values, indicating an improving profitability trajectory.
- Total Stockholders’ Equity
- The total stockholders’ equity declined steadily from early 2019 through the end of 2020, reflecting a depletion of equity likely influenced by the sustained losses during this period. Starting in early 2021, the equity base stabilized and began a gradual increase. This upward trend continued robustly through 2022 and into 2023, suggesting successful measures to rebuild equity, whether through retained earnings, capital injections, or valuation improvements.
- Return on Equity (ROE)
- The ROE followed a closely linked pattern with net income and equity. During 2019 and 2020, the ROE remained negative, with extremely low values in 2020 indicative of the severe financial distress during that period. The trend reversed from late 2020 or early 2021, with ROE climbing steadily into positive territory. A pronounced improvement occurred throughout 2022, with ROE reaching levels above 20%, and maintaining relatively strong returns through 2023. This progression reflects enhanced profitability relative to the equity base and signals an improved efficiency in generating returns for shareholders.
- Overall Observations
- The company experienced a difficult period between mid-2019 and 2020 with large net losses and declining equity. Recovery is evident starting in 2021, marked by improving net income, increasing equity, and rising ROE. The financial health and profitability indicators point to a significant turnaround and strengthening financial position through the latest reported quarters.
Return on Assets (ROA)
Hess Corp., ROA calculation (quarterly data)
| Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||||||||||||||||||||||
| Net income (loss) attributable to Hess Corporation | |||||||||||||||||||||||||
| Total assets | |||||||||||||||||||||||||
| Profitability Ratio | |||||||||||||||||||||||||
| ROA1 | |||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||
| ROA, Competitors2 | |||||||||||||||||||||||||
| Chevron Corp. | |||||||||||||||||||||||||
| ConocoPhillips | |||||||||||||||||||||||||
| Exxon Mobil Corp. | |||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).
1 Q3 2023 Calculation
ROA = 100
× (Net income (loss) attributable to Hess CorporationQ3 2023
+ Net income (loss) attributable to Hess CorporationQ2 2023
+ Net income (loss) attributable to Hess CorporationQ1 2023
+ Net income (loss) attributable to Hess CorporationQ4 2022)
÷ Total assets
= 100 × ( + + + )
÷ =
2 Click competitor name to see calculations.
The quarterly financial data reveals several notable trends in the performance and financial position over the analyzed periods. The company's net income attributable to Hess Corporation exhibited significant fluctuations, with pronounced losses observed during the 2020 quarters, particularly the first quarter with a loss exceeding two billion US dollars. This period is marked by the lowest profitability levels within the dataset. Following this, a gradual recovery and improvement in net income are observed starting from early 2021, with a return to positive net income and further increases into 2022. The most recent quarters in 2023 indicate positive net income, although with some variability and not reaching the peak values seen in late 2021 and 2022.
Total assets showed a moderate decline from early 2019 through the end of 2020, decreasing from over twenty-one thousand seven hundred million US dollars to under nineteen thousand million. This contraction in asset base coincides with the period of sustained net losses, potentially reflecting asset sales, impairments, or other balance sheet contractions. Starting in 2021, total assets began to recover, rising steadily through 2023 to the highest levels recorded in the dataset, surpassing twenty-three thousand million US dollars by the third quarter of 2023.
The return on assets (ROA) metric aligns closely with the net income trend, serving as a critical indicator of profitability relative to asset size. ROA was negative throughout 2019 and the entirety of 2020, with values reaching as low as nearly -17%. Beginning in 2021, ROA shifted into positive territory, showing consistent improvement quarter over quarter. This positive trajectory continued into 2022 and held at relatively strong double-digit percentage points in mid to late 2022, peaking around 9.66%. Although there was a slight decline in ROA during the first three quarters of 2023, the metric remained positive, indicating sustained profitability compared to the asset base.
- Net Income (Loss) Trends
- Substantial losses were concentrated in 2020, with a deep trough at the beginning of that year, followed by a turnaround beginning in 2021 and a general upward trend through 2022 and 2023.
- Total Assets
- After a period of decline through 2020, total assets increased consistently from 2021 onwards, reaching new highs by 2023.
- Return on Assets (ROA)
- ROA mirrored the profitability pattern with negative values during the period of net losses, improving to positive and relatively robust figures starting in 2021, reflecting enhanced operational efficiency or profitability relative to asset base.
Overall, the data suggests a period of financial distress around 2020, followed by recovery and stabilization with increasing profitability and asset growth through to 2023. The trends in net income and ROA are especially indicative of significant operational challenges during 2020 and an effective rebound in subsequent years.