Return on Equity (ROE)
since 2005
Calculation
Illinois Tool Works Inc., ROE, long-term trends, calculation
| ROE | = | 100 | × | Net income1 | ÷ | Stockholders’ equity attributable to ITW1 | |
|---|---|---|---|---|---|---|---|
| Dec 31, 2021 | 74.32% | = | 100 | × | 2,694) | ÷ | 3,625) |
| Dec 31, 2020 | 66.30% | = | 100 | × | 2,109) | ÷ | 3,181) |
| Dec 31, 2019 | 83.31% | = | 100 | × | 2,521) | ÷ | 3,026) |
| Dec 31, 2018 | 78.76% | = | 100 | × | 2,563) | ÷ | 3,254) |
| Dec 31, 2017 | 36.79% | = | 100 | × | 1,687) | ÷ | 4,585) |
| Dec 31, 2016 | 47.84% | = | 100 | × | 2,035) | ÷ | 4,254) |
| Dec 31, 2015 | 36.35% | = | 100 | × | 1,899) | ÷ | 5,224) |
| Dec 31, 2014 | 43.20% | = | 100 | × | 2,946) | ÷ | 6,819) |
| Dec 31, 2013 | 17.30% | = | 100 | × | 1,679) | ÷ | 9,703) |
| Dec 31, 2012 | 27.18% | = | 100 | × | 2,870) | ÷ | 10,561) |
| Dec 31, 2011 | 20.68% | = | 100 | × | 2,071) | ÷ | 10,018) |
| Dec 31, 2010 | 16.30% | = | 100 | × | 1,527) | ÷ | 9,370) |
| Dec 31, 2009 | 10.75% | = | 100 | × | 947) | ÷ | 8,808) |
| Dec 31, 2008 | 19.82% | = | 100 | × | 1,519) | ÷ | 7,663) |
| Dec 31, 2007 | 20.00% | = | 100 | × | 1,870) | ÷ | 9,351) |
| Dec 31, 2006 | 19.05% | = | 100 | × | 1,718) | ÷ | 9,018) |
| Dec 31, 2005 | 19.81% | = | 100 | × | 1,495) | ÷ | 7,547) |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).
1 US$ in millions
The financial performance between 2005 and 2021 is characterized by a significant transition in capital structure and profitability metrics. While net income remained resilient over the long term, the Return on Equity (ROE) underwent a dramatic expansion, shifting from a stable range in the early period to exceptionally high levels in the latter half of the timeline.
- Net Income Trends
- Net income exhibited periodic volatility but maintained a general upward trajectory. A notable contraction occurred in 2009, when income fell to 947 million US dollars, followed by a recovery and subsequent growth. The metric reached a high of 2,946 million US dollars in 2014 and concluded the period at 2,694 million US dollars in 2021.
- Stockholders' Equity Dynamics
- A significant and sustained reduction in stockholders' equity is observed following a peak of 10,561 million US dollars in 2012. Equity declined sharply from 2014 onward, reaching a minimum of 3,026 million US dollars in 2019. This contraction in the equity base occurred even as net income remained strong or increased, indicating a fundamental shift in how the company manages its capital.
- Return on Equity (ROE) Analysis
- ROE remained relatively stable between 19.05% and 20.68% from 2005 to 2011, with the exception of a sharp decline to 10.75% in 2009. Starting in 2014, the ROE accelerated rapidly, jumping from 17.30% in 2013 to 43.20% in 2014. This upward trend peaked at 83.31% in 2019 and remained elevated at 74.32% by 2021. The escalation is primarily driven by the mathematical effect of maintaining high earnings while aggressively reducing the stockholders' equity base.
AI Ask an analyst for more
Hi, I’m an AI-powered financial analyst at Stock Analysis on Net.
How can I help you?
Comparison to Competitors
Illinois Tool Works Inc., ROE, long-term trends, comparison to competitors
| Illinois Tool Works Inc. | Boeing Co. | Caterpillar Inc. | Eaton Corp. plc | GE Aerospace | Honeywell International Inc. | Lockheed Martin Corp. | RTX Corp. | |
|---|---|---|---|---|---|---|---|---|
| Dec 31, 2021 | 74.32% | — | 39.37% | 13.06% | -16.17% | 29.85% | 57.62% | 5.29% |
| Dec 31, 2020 | 66.30% | — | 19.56% | 9.44% | 16.04% | 27.23% | 113.60% | -4.88% |
| Dec 31, 2019 | 83.31% | — | 41.77% | 13.75% | -17.58% | 33.22% | 199.23% | 13.25% |
| Dec 31, 2018 | 78.76% | 3,085.55% | 43.79% | 13.32% | -72.16% | 37.21% | 361.98% | 13.70% |
| Dec 31, 2017 | 36.79% | 2,309.01% | 5.50% | 17.30% | -9.00% | 9.58% | — | 15.37% |
| Dec 31, 2016 | 47.84% | 599.14% | -0.51% | 12.90% | 11.65% | 24.83% | 350.89% | 18.33% |
| Dec 31, 2015 | 36.35% | 81.70% | 14.19% | 13.03% | -6.23% | 26.08% | 116.40% | 27.81% |
| Dec 31, 2014 | 43.20% | 62.85% | 22.06% | 11.36% | 11.89% | 24.01% | 106.29% | 19.93% |
| Dec 31, 2013 | 17.30% | 30.82% | 18.21% | 11.08% | 10.00% | 22.47% | 60.61% | 17.95% |
| Dec 31, 2012 | 27.18% | 66.47% | 32.40% | 8.07% | 11.09% | 22.55% | 7,038.46% | 19.80% |
| Dec 31, 2011 | 20.68% | 114.31% | 38.25% | 18.07% | 12.15% | 19.13% | 265.23% | 22.76% |
| Dec 31, 2010 | 16.30% | 119.56% | 24.94% | 12.62% | 9.79% | 18.96% | 78.91% | 20.45% |
| Dec 31, 2009 | 10.75% | 61.65% | 10.24% | 5.65% | 9.40% | 24.34% | 73.24% | 19.08% |
| Dec 31, 2008 | 19.82% | — | 58.44% | 16.75% | 16.63% | 38.85% | 112.29% | 29.46% |
| Dec 31, 2007 | 20.00% | 45.25% | 39.86% | 19.22% | 19.22% | 26.50% | 30.93% | 19.78% |
| Dec 31, 2006 | 19.05% | 46.74% | 51.57% | 23.14% | 18.55% | 21.43% | 36.74% | 21.58% |
| Dec 31, 2005 | 19.81% | 23.26% | 33.85% | 21.31% | 14.95% | 14.71% | 23.20% | 18.06% |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).
Comparison to Sector (Capital Goods)
Illinois Tool Works Inc., ROE, long-term trends, comparison to sector (capital goods)
| Illinois Tool Works Inc. | Capital Goods | |
|---|---|---|
| Dec 31, 2021 | 74.32% | 8.48% |
| Dec 31, 2020 | 66.30% | 4.42% |
| Dec 31, 2019 | 83.31% | 18.11% |
| Dec 31, 2018 | 78.76% | 11.28% |
| Dec 31, 2017 | 36.79% | 10.13% |
| Dec 31, 2016 | 47.84% | 20.08% |
| Dec 31, 2015 | 36.35% | 10.42% |
| Dec 31, 2014 | 43.20% | 18.16% |
| Dec 31, 2013 | 17.30% | 15.14% |
| Dec 31, 2012 | 27.18% | 17.58% |
| Dec 31, 2011 | 20.68% | 19.63% |
| Dec 31, 2010 | 16.30% | 15.88% |
| Dec 31, 2009 | 10.75% | 13.47% |
| Dec 31, 2008 | 19.82% | 24.97% |
| Dec 31, 2007 | 20.00% | 22.64% |
| Dec 31, 2006 | 19.05% | 22.16% |
| Dec 31, 2005 | 19.81% | 17.27% |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).
Comparison to Industry (Industrials)
Illinois Tool Works Inc., ROE, long-term trends, comparison to industry (industrials)
| Illinois Tool Works Inc. | Industrials | |
|---|---|---|
| Dec 31, 2021 | 74.32% | 15.38% |
| Dec 31, 2020 | 66.30% | 0.24% |
| Dec 31, 2019 | 83.31% | 14.56% |
| Dec 31, 2018 | 78.76% | 17.95% |
| Dec 31, 2017 | 36.79% | 18.24% |
| Dec 31, 2016 | 47.84% | 21.69% |
| Dec 31, 2015 | 36.35% | 16.11% |
| Dec 31, 2014 | 43.20% | 19.68% |
| Dec 31, 2013 | 17.30% | 16.40% |
| Dec 31, 2012 | 27.18% | 17.20% |
| Dec 31, 2011 | 20.68% | 20.10% |
| Dec 31, 2010 | 16.30% | 16.41% |
| Dec 31, 2009 | 10.75% | 12.84% |
| Dec 31, 2008 | 19.82% | 20.74% |
| Dec 31, 2007 | 20.00% | 20.36% |
| Dec 31, 2006 | 19.05% | 32.16% |
| Dec 31, 2005 | 19.81% | 7.80% |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).