Analysis of Profitability Ratios
Quarterly Data
Profitability ratios measure the company ability to generate profitable sales from its resources (assets).
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- Cash Flow Statement
- Common-Size Balance Sheet: Assets
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Common Stock Valuation Ratios
- Enterprise Value to FCFF (EV/FCFF)
- Selected Financial Data since 2005
- Return on Equity (ROE) since 2005
- Return on Assets (ROA) since 2005
- Price to Operating Profit (P/OP) since 2005
- Price to Sales (P/S) since 2005
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Profitability Ratios (Summary)
Illinois Tool Works Inc., profitability ratios (quarterly data)
Based on: 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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31).
Analysis of the quarterly financial data reveals several notable trends in profitability and efficiency metrics over the observed periods.
- Gross Profit Margin (%)
- The gross profit margin remained relatively stable throughout the period from March 2017 through December 2021, fluctuating slightly around the low 40% range. Starting near 41.95% in early 2017, it experienced minor declines during 2020, coinciding likely with economic disruptions, but recovered to about 41.27% by the end of 2021. This consistency suggests sustained control over production costs relative to revenue.
- Operating Profit Margin (%)
- Operating margins displayed a modest downward trend during the period. From approximately 24.41% in early 2017, the margin maintained levels around 24% until 2019. In 2020, it declined noticeably to a low near 22.46%, reflecting potential operational challenges amid external pressures. However, by the end of 2021, a recovery trend was observed with the margin improving back toward 24.05%. This pattern indicates some resilience in operational efficiency despite external headwinds.
- Net Profit Margin (%)
- The net profit margin demonstrated significant upward momentum beginning in 2018. From mid-teens percentages, the margin increased substantially, peaking near 19.14% by mid-2021 before a slight dip at the end of 2021. This growth suggests enhanced overall profitability, potentially driven by effective cost management or favorable financing and tax conditions. The steady improvement, despite a minor 2020 dip, highlights strong bottom-line performance over the medium term.
- Return on Equity (ROE) (%)
- ROE exhibited pronounced volatility but with a generally upward trajectory from 2017 through 2021. Initial values around 36.79% surged dramatically to over 100% in early 2020, indicating periods of exceptional equity efficiency or possible impacts from one-time events or accounting adjustments. Post-peak, the ROE moderated but remained elevated, settling around the mid-70% range by the end of 2021. This pattern points to improved shareholder value generation but warrants closer examination for sustainability and factors driving the spikes.
- Return on Assets (ROA) (%)
- ROA trends also moved upward from about 10% in early 2017 to peaks exceeding 17% during 2021, reflecting enhanced asset utilization efficiency. Similar to ROE, ROA experienced a decline during 2020 before rebounding. The relative stability and improvement in ROA suggest effective asset management contributing to profitability gains.
Overall, the data indicates strong and improving profitability metrics over the analyzed quarters, albeit with some impact during the 2020 period likely related to macroeconomic challenges. Both operational and net margins have shown resilience and recovery. Elevated returns on equity and assets highlight efficient capital and asset use, though the marked spikes call for further investigation into underlying causes for atypical results. The financial performance signals solid operational control and value creation capabilities for the periods examined.
Return on Sales
Return on Investment
Gross Profit Margin
Illinois Tool Works Inc., gross profit margin calculation (quarterly data)
| 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 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||
| Gross profit | ||||||||||||||||||||||||||
| Operating revenue | ||||||||||||||||||||||||||
| Profitability Ratio | ||||||||||||||||||||||||||
| Gross profit margin1 | ||||||||||||||||||||||||||
| Benchmarks | ||||||||||||||||||||||||||
| Gross Profit Margin, Competitors2 | ||||||||||||||||||||||||||
| Boeing Co. | ||||||||||||||||||||||||||
| Caterpillar Inc. | ||||||||||||||||||||||||||
| Eaton Corp. plc | ||||||||||||||||||||||||||
| GE Aerospace | ||||||||||||||||||||||||||
| Honeywell International Inc. | ||||||||||||||||||||||||||
| Lockheed Martin Corp. | ||||||||||||||||||||||||||
| RTX Corp. | ||||||||||||||||||||||||||
Based on: 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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31).
1 Q4 2021 Calculation
Gross profit margin = 100
× (Gross profitQ4 2021
+ Gross profitQ3 2021
+ Gross profitQ2 2021
+ Gross profitQ1 2021)
÷ (Operating revenueQ4 2021
+ Operating revenueQ3 2021
+ Operating revenueQ2 2021
+ Operating revenueQ1 2021)
= 100 × ( + + + )
÷ ( + + + )
=
2 Click competitor name to see calculations.
- Operating Revenue
- Operating revenue exhibited a generally fluctuating yet stable pattern over the observed periods from early 2017 through the end of 2021. Initial quarters in 2017 showed a steady increase, peaking around the second quarter of 2018. However, a mild decline followed in the latter part of 2018 and into early 2019, with revenue levels dipping below the mid-2018 peak. From mid-2019 to early 2020, revenues remained relatively stable before experiencing a significant drop in the second quarter of 2020. This decline was notably sharp, reflecting a downturn likely related to external economic factors during that time. Subsequently, operating revenue recovered steadily throughout the second half of 2020 and into 2021, ultimately returning to levels near or above pre-drop quarters by the end of 2021.
- Gross Profit
- Gross profit mirrored the basic trend seen in operating revenue but with some variances. From 2017 through early 2018, gross profit steadily increased, reaching its peak in mid-2018. Similar to revenue, there was a modest dip towards the end of 2018 and the first half of 2019, after which gross profit stabilized but did not show significant growth. The sharp decline in the second quarter of 2020 was even more pronounced for gross profit than for revenue, indicating heightened pressure on profit margins or cost structures during that period. A consistent recovery was observed through the subsequent quarters, with gross profit levels returning closer to earlier highs by the end of 2021. Despite recovery, gross profit in late 2021 did not consistently surpass the highest pre-2020 levels.
- Gross Profit Margin
- The gross profit margin remained relatively stable throughout the period, with values generally hovering around 41.7% to 42.0%. Minor fluctuations are observed, but no long-term trend of significant increase or decrease is evident. The margin sustained stability despite the volatility in absolute gross profit and operating revenue figures. The lowest margin appears during the second quarter of 2020, coinciding with the sharp drop in revenue and profit, while subsequent quarters show a return to a range close to previous years, indicating a recovery in operational efficiency or pricing power after the 2020 disruption.
Operating Profit Margin
Illinois Tool Works Inc., operating profit margin calculation (quarterly data)
| 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 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||
| Operating income | ||||||||||||||||||||||||||
| Operating revenue | ||||||||||||||||||||||||||
| Profitability Ratio | ||||||||||||||||||||||||||
| Operating profit margin1 | ||||||||||||||||||||||||||
| Benchmarks | ||||||||||||||||||||||||||
| Operating Profit Margin, Competitors2 | ||||||||||||||||||||||||||
| Boeing Co. | ||||||||||||||||||||||||||
| Caterpillar Inc. | ||||||||||||||||||||||||||
| Eaton Corp. plc | ||||||||||||||||||||||||||
| GE Aerospace | ||||||||||||||||||||||||||
| Honeywell International Inc. | ||||||||||||||||||||||||||
| Lockheed Martin Corp. | ||||||||||||||||||||||||||
| RTX Corp. | ||||||||||||||||||||||||||
Based on: 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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31).
1 Q4 2021 Calculation
Operating profit margin = 100
× (Operating incomeQ4 2021
+ Operating incomeQ3 2021
+ Operating incomeQ2 2021
+ Operating incomeQ1 2021)
÷ (Operating revenueQ4 2021
+ Operating revenueQ3 2021
+ Operating revenueQ2 2021
+ Operating revenueQ1 2021)
= 100 × ( + + + )
÷ ( + + + )
=
2 Click competitor name to see calculations.
The financial data indicates several trends in operating income, operating revenue, and operating profit margin over the analyzed periods.
- Operating Income
- The operating income demonstrates an overall stable trend with moderate fluctuations across the quarters. Starting from $809 million in March 2017, it peaked at $961 million in September 2017 before trending downward towards the end of 2017. Throughout 2018 and 2019, operating income mostly remained within the range of approximately $839 million to $932 million, showing some consistency. However, there is a notable decline in 2020, reaching a low of $449 million in June 2020, likely reflecting an external impact or operational challenges during that period. After mid-2020, operating income recovered gradually, climbing back to levels around $845 to $905 million by the end of 2021, although it did not surpass earlier peaks.
- Operating Revenue
- Operating revenue exhibits a generally increasing trend from 2017 through 2019, rising from approximately $3.47 billion in March 2017 to nearly $3.61 billion in June 2019. There is a marked decrease in revenue during 2020, dropping to a trough of about $2.56 billion in June 2020, which corresponds with the period of reduced operating income. This revenue dip is followed by a recovery trend throughout late 2020 and 2021, reaching $3.68 billion in December 2021. The recovery suggests a rebound in demand or operational capacity post the mid-2020 trough.
- Operating Profit Margin
- The operating profit margin was consistently strong and relatively stable starting at around 24.4% in early 2018 through early 2019. There was a slight contraction in margin during 2020, reflecting impact on profitability which coincides with the decline seen in both revenue and income. Margins fell to approximately 22.46% in June 2020 but then steadily improved, surpassing previous levels by the end of 2021 and reaching up to 24.78% in September 2021. The persistence of margins near or above 24% during recovery suggests effective cost management or pricing power despite revenue volatility.
In summary, both operating income and operating revenue experienced a significant decline during the mid-2020 timeframe, likely caused by an extraordinary event impacting operational performance. However, both metrics showed recovery by the end of the period under review. The operating profit margin decreased moderately during the downturn but rebounded to previous levels, indicating resilience in profitability management. The data suggests that the company maintained robust operational efficiency and was able to restore financial performance following the mid-2020 disruption.
Net Profit Margin
Illinois Tool Works Inc., net profit margin calculation (quarterly data)
| Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||
| Net income | ||||||||||||||||||||||||||
| Operating revenue | ||||||||||||||||||||||||||
| Profitability Ratio | ||||||||||||||||||||||||||
| Net profit margin1 | ||||||||||||||||||||||||||
| Benchmarks | ||||||||||||||||||||||||||
| Net Profit Margin, Competitors2 | ||||||||||||||||||||||||||
| Boeing Co. | ||||||||||||||||||||||||||
| Caterpillar Inc. | ||||||||||||||||||||||||||
| Eaton Corp. plc | ||||||||||||||||||||||||||
| GE Aerospace | ||||||||||||||||||||||||||
| Honeywell International Inc. | ||||||||||||||||||||||||||
| Lockheed Martin Corp. | ||||||||||||||||||||||||||
| RTX Corp. | ||||||||||||||||||||||||||
Based on: 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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31).
1 Q4 2021 Calculation
Net profit margin = 100
× (Net incomeQ4 2021
+ Net incomeQ3 2021
+ Net incomeQ2 2021
+ Net incomeQ1 2021)
÷ (Operating revenueQ4 2021
+ Operating revenueQ3 2021
+ Operating revenueQ2 2021
+ Operating revenueQ1 2021)
= 100 × ( + + + )
÷ ( + + + )
=
2 Click competitor name to see calculations.
- Net Income Trends
- Over the analyzed periods, net income exhibited significant fluctuations. Initially, from March 2017 to September 2017, net income showed a steady increase from 536 million US dollars to 640 million US dollars. A notable exception occurred in December 2017, where net income sharply declined to -76 million US dollars, indicating a loss for that quarter. Following this downturn, net income recovered and stabilized around the 600 million US dollar range through 2018 and 2019, with some minor variations. In 2020, values declined, reaching a low of 319 million US dollars in June, likely reflecting external impacts during that period. However, net income exhibited recovery in the subsequent quarters, peaking at 775 million US dollars in September 2021 before slightly declining again towards the end of 2021.
- Operating Revenue Patterns
- Operating revenue demonstrated a generally cyclical pattern with some downward pressure in 2020. Revenue values ranged mostly between 3,400 million and 3,800 million US dollars in the years 2017 through 2019, showing moderate growth through mid-2018 but with some volatility, particularly a dip in the third quarter of 2018. In 2020, a sharp decline was observed with revenue dropping to as low as 2,564 million US dollars in the second quarter, followed by a gradual recovery reaching approximately 3,675 million in the final quarters of 2021. This trend suggests significant operational challenges during the mid-2020 period, with progressive restoration of sales or service levels into 2021.
- Net Profit Margin Changes
- Net profit margin values were not available for the early years analyzed, but from March 2018 onwards, the margin displayed a positive and generally upward trend. Starting at approximately 11.79% in March 2018, the margin increased steadily, reaching over 17% in 2019 and maintaining or increasing further through 2020 and 2021, peaking above 19% in the second and third quarters of 2021. This indicates an improvement in profitability relative to revenue, possibly reflecting better cost control, pricing strategy, or changes in product mix during those periods.
- General Observations
- The data depicts a company facing a major earnings setback in late 2017 and experiencing a revenue and income decline in 2020, likely due to adverse external factors. Despite these challenges, both net income and operating revenue demonstrated recovery trends in 2021. Additionally, increasing net profit margins after 2018 suggest enhanced efficiency or profitability within its operations. The deviation in quarterly results highlights volatility but also resilience in financial performance over the analyzed timeframe.
Return on Equity (ROE)
Illinois Tool Works Inc., ROE calculation (quarterly data)
| 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 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||
| Net income | ||||||||||||||||||||||||||
| Stockholders’ equity attributable to ITW | ||||||||||||||||||||||||||
| Profitability Ratio | ||||||||||||||||||||||||||
| ROE1 | ||||||||||||||||||||||||||
| Benchmarks | ||||||||||||||||||||||||||
| ROE, Competitors2 | ||||||||||||||||||||||||||
| Boeing Co. | ||||||||||||||||||||||||||
| Caterpillar Inc. | ||||||||||||||||||||||||||
| Eaton Corp. plc | ||||||||||||||||||||||||||
| GE Aerospace | ||||||||||||||||||||||||||
| Honeywell International Inc. | ||||||||||||||||||||||||||
| Lockheed Martin Corp. | ||||||||||||||||||||||||||
| RTX Corp. | ||||||||||||||||||||||||||
Based on: 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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31).
1 Q4 2021 Calculation
ROE = 100
× (Net incomeQ4 2021
+ Net incomeQ3 2021
+ Net incomeQ2 2021
+ Net incomeQ1 2021)
÷ Stockholders’ equity attributable to ITW
= 100 × ( + + + )
÷ =
2 Click competitor name to see calculations.
The financial data reveals several noteworthy trends in profitability and equity over the assessed quarters.
- Net Income
- Net income exhibited positive growth in most quarters between March 2017 and December 2019, with values generally increasing from 536 million to a peak of 660 million before a slight decrease to 641 million. This upward trajectory suggests a period of improving earnings performance until the end of 2019.
- Starting in March 2020, there is a notable drop in net income values, with a significant decline evident in the second quarter of 2020 to 319 million, likely reflecting the impact of external economic disruptions. However, a recovery trend appears to take hold thereafter, with net income rebounding and reaching 775 million by the fourth quarter of 2021. Despite volatility, the net income levels toward the end of the period remain robust relative to earlier years.
- Stockholders’ Equity Attributable to Illinois Tool Works
- The stockholders’ equity shows a downward trend over the entire timeline, decreasing from 4,493 million in March 2017 to a low of 2,283 million in March 2020. This decline may indicate factors such as equity reduction, share buybacks, or accumulated losses during this period.
- Following the low in early 2020, equity begins a recovery trend, rising steadily to 3,625 million by December 2021. Although equity does not return to earlier peak levels, this upward movement signals a gradual strengthening of the company’s capital base in the latter stages of the timeline.
- Return on Equity (ROE)
- ROE data starts from March 2018 and demonstrates a consistently high and increasing trend, starting at 36.79% and reaching a peak of 109.07% in March 2020. This sharp rise indicates enhanced profitability relative to shareholders’ equity, driven perhaps by lower equity levels or higher net income.
- After peaking in early 2020, ROE declines but remains elevated, fluctuating between approximately 66% and 78% through to the end of 2021. These levels reflect strong returns for shareholders despite equity fluctuations.
Overall, the analysis highlights a period of strong income generation and improving returns on equity, coupled with a temporary decline and subsequent recovery in stockholders’ equity. The elevated ROE suggests efficient use of equity capital, especially in the context of fluctuating equity balances. The net income recovery after mid-2020 indicates resilience amid challenging conditions.
Return on Assets (ROA)
Illinois Tool Works Inc., ROA calculation (quarterly data)
| 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 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||
| Net income | ||||||||||||||||||||||||||
| Total assets | ||||||||||||||||||||||||||
| Profitability Ratio | ||||||||||||||||||||||||||
| ROA1 | ||||||||||||||||||||||||||
| Benchmarks | ||||||||||||||||||||||||||
| ROA, Competitors2 | ||||||||||||||||||||||||||
| Boeing Co. | ||||||||||||||||||||||||||
| Caterpillar Inc. | ||||||||||||||||||||||||||
| Eaton Corp. plc | ||||||||||||||||||||||||||
| GE Aerospace | ||||||||||||||||||||||||||
| Honeywell International Inc. | ||||||||||||||||||||||||||
| Lockheed Martin Corp. | ||||||||||||||||||||||||||
| RTX Corp. | ||||||||||||||||||||||||||
Based on: 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), 10-K (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-K (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31).
1 Q4 2021 Calculation
ROA = 100
× (Net incomeQ4 2021
+ Net incomeQ3 2021
+ Net incomeQ2 2021
+ Net incomeQ1 2021)
÷ Total assets
= 100 × ( + + + )
÷ =
2 Click competitor name to see calculations.
The quarterly financial data reveals several notable patterns and trends over the analyzed periods. Net income demonstrates variability across quarters, with a significant drop to a negative value in December 2017, followed by a recovery and relative stability with fluctuations ranging mostly between approximately 566 million and 775 million US dollars. The lowest recorded net income after the negative spike occurred in June 2020, with a reduction likely influenced by economic conditions during that period. Thereafter, net income gradually regained strength, peaking near 775 million in September 2021 before slightly decreasing by the end of the period.
Total assets exhibit a general downward trend from early 2017 through mid-2020, declining from about 16,780 million US dollars in December 2017 to a low near 14,149 million in March 2020. Starting mid-2020, total assets show a recovery trend, increasing to approximately 16,077 million by December 2021. The fluctuations in total assets may reflect changes in asset management strategies, acquisitions, disposals, or shifts in market conditions.
The Return on Assets (ROA) metric emerges from the data starting March 2018 onward, illustrating a healthy profitability relative to the company's asset base. ROA values commence at around 10.05%, steadily climb through 2018, and consistently maintain a high-performance level, generally fluctuating between 13% and 17%, with peak values approximately 17.57% in September 2021. This consistent ROA suggests an efficient use of assets to generate earnings despite volatility in net income and total assets.
- Net Income
- Marked by a significant negative outlier in December 2017, followed by steady recovery and periods of growth with some fluctuations, indicating resilience and adaptation to varying operational conditions.
- Total Assets
- Show a declining trend through early periods until mid-2020, thereafter exhibiting recovery and growth, which may correlate with strategic capital allocation or market environment shifts.
- Return on Assets (ROA)
- Maintains a stable and improving trend post-2018, indicating effective management of asset utilization to maintain profitability despite other financial fluctuations.