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: Liabilities and Stockholders’ Equity
- Common-Size Income Statement
- Analysis of Solvency Ratios
- Analysis of Long-term (Investment) Activity Ratios
- Enterprise Value (EV)
- Price to FCFE (P/FCFE)
- Capital Asset Pricing Model (CAPM)
- Current Ratio since 2005
- Price to Earnings (P/E) since 2005
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Profitability Ratios (Summary)
Parker-Hannifin Corp., profitability ratios (quarterly data)
Based on: 10-Q (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-K (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-K (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-K (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-Q (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-K (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-Q (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-K (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-K (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-Q (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30).
The financial data reveals several trends over the observed periods, particularly across profitability and return metrics.
- Gross Profit Margin
- This metric shows a consistent upward trend from 23.61% in September 2016 to 30.5% in December 2022, indicating steady improvement in core profitability. The margin increased gradually over the years, with minor fluctuations, reflecting effective management of production costs relative to sales.
- Operating Profit Margin
- The operating profit margin also exhibits a general rising trend, beginning at 11.53% in September 2016 and peaking around 17.95% in September 2022 before declining slightly to 16.01% in December 2022. This suggests improved operational efficiency over time though some recent softness is observed towards the end of the period.
- Net Profit Margin
- Net profit margin experienced more volatility compared with gross and operating margins. It started at 8.18% in September 2016, reaching a high of 12.61% in March 2021, then declining to 7.33% by December 2022. This indicates that while profitability improved significantly for a time, there was a downward trend in net profitability towards the latter part of the timeline.
- Return on Equity (ROE)
- ROE shows an upward trajectory from 18.69% in the initial available period to a peak near 24% around 2018-2019, followed by fluctuations and a steady decline to 13.52% by December 2022. The decline in recent periods may reflect reduced profitability or changes in equity base, signaling potential challenges in maintaining shareholder returns.
- Return on Assets (ROA)
- ROA increased from 6.35% in September 2016 to highs near 9.38% in late 2018 but softened afterwards, dropping to around 4.13% by the end of 2022. This suggests a reduction in asset utilization efficiency or overall profitability relative to asset base in the recent periods.
In summary, the data shows strong improvements in gross and operating margins over the medium term, supporting higher earnings capacity. However, net profit margin, ROE, and ROA indicate some erosion in bottom-line profitability and returns on investments in more recent quarters. These trends may point to increased costs, changing market conditions, or strategic shifts impacting net results and asset efficiency toward the end of the measured timeframe.
Return on Sales
Return on Investment
Gross Profit Margin
Parker-Hannifin Corp., gross profit margin calculation (quarterly data)
| 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 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||||||||||||||||||||||||||||||
| Gross profit | ||||||||||||||||||||||||||||||||||
| Net sales | ||||||||||||||||||||||||||||||||||
| 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-Q (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-K (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-K (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-K (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-Q (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-K (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-Q (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-K (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-K (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-Q (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30).
1 Q2 2023 Calculation
Gross profit margin = 100
× (Gross profitQ2 2023
+ Gross profitQ1 2023
+ Gross profitQ4 2022
+ Gross profitQ3 2022)
÷ (Net salesQ2 2023
+ Net salesQ1 2023
+ Net salesQ4 2022
+ Net salesQ3 2022)
= 100 × ( + + + )
÷ ( + + + )
=
2 Click competitor name to see calculations.
The analysis of the financial data reveals several key trends in the quarterly performance over the observed periods.
- Net Sales
- Net sales demonstrate a generally increasing trend over the years, starting around 2.74 billion US dollars in the third quarter of 2016 and reaching approximately 4.67 billion US dollars by the end of 2022. Despite fluctuations, including slight declines and plateau phases around late 2018 and mid-2020, the overall pattern is upward, indicating growth in the company’s sales volume or pricing power.
- Gross Profit
- Gross profit has also shown a rising trajectory, though with some volatility. It increased from approximately 637 million US dollars in the third quarter of 2016 to about 1.44 billion US dollars in the fourth quarter of 2022. There are periods of decline or stagnation, for example, in the second half of 2017 and mid-2020, which could correspond to operational challenges or market conditions, but subsequent recoveries demonstrate resilience.
- Gross Profit Margin
- The gross profit margin percentage, beginning only from the first quarter of 2017 data availability, shows a consistent increase over time. Initially around 23.6%, it gradually rises to about 30.5% by the fourth quarter of 2022. This continuous margin expansion suggests improved efficiency in production, better cost controls, or favorable product mix shifts enhancing profitability relative to sales.
In summary, the data indicates sustained growth in net sales and gross profit with a strong improvement in gross profit margin across the analyzed periods. Despite some short-term fluctuations, the overall financial health and operational efficiency appear to be strengthening, reflecting positively on the company's market position and cost management strategies.
Operating Profit Margin
Parker-Hannifin Corp., operating profit margin calculation (quarterly data)
| 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 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||||||||||||||||||||||||||||||
| Operating income | ||||||||||||||||||||||||||||||||||
| Net sales | ||||||||||||||||||||||||||||||||||
| 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-Q (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-K (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-K (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-K (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-Q (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-K (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-Q (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-K (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-K (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-Q (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30).
1 Q2 2023 Calculation
Operating profit margin = 100
× (Operating incomeQ2 2023
+ Operating incomeQ1 2023
+ Operating incomeQ4 2022
+ Operating incomeQ3 2022)
÷ (Net salesQ2 2023
+ Net salesQ1 2023
+ Net salesQ4 2022
+ Net salesQ3 2022)
= 100 × ( + + + )
÷ ( + + + )
=
2 Click competitor name to see calculations.
- Operating Income
- The operating income demonstrates a generally increasing trend over the period analyzed. From September 2016 through December 2022, operating income rose from approximately 314 million USD to values reaching above 780 million USD at the end of 2022. There is notable volatility with some declines, especially visible around late 2019 and mid-2020, where operating income decreased but rebounded quickly thereafter. The quarters in 2021 and 2022 reveal strong growth, with operating income peaking during these years.
- Net Sales
- Net sales also show an overall upward trend, increasing from roughly 2.74 billion USD in late 2016 to approximately 4.67 billion USD by the end of 2022. Variability is observed with periods of stagnation or slight declines, notably in mid-2020 which may correlate with macroeconomic conditions during that time. After this phase, sales picked up again, showing consistent growth through 2021 and 2022, indicating recovery and expansion.
- Operating Profit Margin
- The operating profit margin data, available from March 2017 onward, indicates a general improvement in profitability. Starting at around 11.53% in early 2017, the margin progressively increased, reaching a peak of approximately 17.95% in late 2022. There are fluctuations; however, the overall trend reflects enhanced operational efficiency or pricing power. Margins dipped slightly around mid-2020 but recovered and improved steadily afterward.
- Summary of Trends and Insights
- The combined analysis of operating income, net sales, and operating profit margins reveals that the company experienced solid financial growth over the examined periods. Despite some downturns, especially around 2019 and 2020, the resilience and recovery are evident with significant gains in sales and profitability thereafter. The rising profit margin suggests improved cost management or product mix leading to enhanced earnings relative to sales. The data suggest a strengthening operational performance culminating in a robust financial position by the end of 2022.
Net Profit Margin
Parker-Hannifin Corp., net profit margin calculation (quarterly data)
| 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 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||||||||||||||||||||||||||||||
| Net income attributable to common shareholders | ||||||||||||||||||||||||||||||||||
| Net sales | ||||||||||||||||||||||||||||||||||
| 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-Q (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-K (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-K (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-K (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-Q (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-K (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-Q (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-K (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-K (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-Q (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30).
1 Q2 2023 Calculation
Net profit margin = 100
× (Net income attributable to common shareholdersQ2 2023
+ Net income attributable to common shareholdersQ1 2023
+ Net income attributable to common shareholdersQ4 2022
+ Net income attributable to common shareholdersQ3 2022)
÷ (Net salesQ2 2023
+ Net salesQ1 2023
+ Net salesQ4 2022
+ Net salesQ3 2022)
= 100 × ( + + + )
÷ ( + + + )
=
2 Click competitor name to see calculations.
- Net Income Attributable to Common Shareholders
- Over the observed period, net income showed notable fluctuations with some quarters experiencing sharp increases and others significant declines. A peak was observed around March 2018, followed by a period of variability. The net income fell sharply in December 2017 but rebounded strongly in early 2018. From 2019 through the first half of 2020, net income maintained relatively elevated levels with intermittent decreases. However, a substantial dip occurred in the third quarter of 2022 before recovering again by the end of the year.
- Net Sales
- Net sales displayed an overall upward trend despite some quarter-to-quarter variations. Starting from just under 2.75 billion USD in late 2016, sales increased steadily with some seasonal fluctuations until peaking near 4.67 billion USD by the end of 2022. Sales growth was somewhat interrupted in mid-2020, likely reflecting external economic impacts, but resumed a positive trajectory into 2021 and 2022. The growth pattern suggests expansion or increased demand across the periods.
- Net Profit Margin
- Net profit margin exhibited a generally ascending trend over the periods for which data is available. Starting from near 6.5% in mid-2017, margins improved to above 12% in late 2021. This indicates increasing profitability relative to sales. After peaking, margins experienced a decline in late 2022, aligning with the drop in net income despite continuing high sales figures. This declining margin toward the end of the period could signify increased costs or pricing pressures.
- Overall Analysis
- The financial data reflects growth in sales alongside fluctuating profitability. Despite increased net sales, net income and profit margins showed volatility, suggesting variability in cost control, operational efficiency, or other expenses affecting net income. The trend of rising profit margins until late 2021 implies improvements in operational performance or product mix. The decline in profitability metrics in the latter part of 2022, amid sustained sales growth, points to potential challenges warranting further investigation.
Return on Equity (ROE)
Parker-Hannifin Corp., ROE calculation (quarterly data)
| 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 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||||||||||||||||||||||||||||||
| Net income attributable to common shareholders | ||||||||||||||||||||||||||||||||||
| Shareholders’ equity | ||||||||||||||||||||||||||||||||||
| 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-Q (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-K (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-K (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-K (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-Q (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-K (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-Q (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-K (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-K (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-Q (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30).
1 Q2 2023 Calculation
ROE = 100
× (Net income attributable to common shareholdersQ2 2023
+ Net income attributable to common shareholdersQ1 2023
+ Net income attributable to common shareholdersQ4 2022
+ Net income attributable to common shareholdersQ3 2022)
÷ Shareholders’ equity
= 100 × ( + + + )
÷ =
2 Click competitor name to see calculations.
The net income attributable to common shareholders demonstrates notable fluctuations over the periods reviewed. Initially, the values range from approximately 210 million to nearly 293 million US dollars between September 2016 and June 2017, showing a general increases with some volatility. A distinct decline occurs in December 2017, where net income drops significantly to around 56 million US dollars, followed by a sharp recovery and growth reaching a peak of approximately 447 million US dollars in March 2021. Post this peak, the net income experiences a gradual descending trend, diminishing to around 128 million US dollars by September 2022, before a slight recovery at the end of the year.
Shareholders’ equity shows a steady overall upward trend from 4.65 billion US dollars in September 2016 to over 9.3 billion US dollars by December 2022. Despite minor fluctuations and some periods of stability, particularly around late 2017 and late 2018, the company's equity base has more than doubled over the course of the timeframe. Noteworthy is the sustained increase in equity during the latter periods, especially post-2020, indicating continued capitalization and retained earnings growth despite short-term net income variability.
Return on equity (ROE) figures, available from March 2017 onwards, provide insight into profitability relative to shareholders' equity. ROE begins at around 18.7% and generally trends upwards, reaching its highest at approximately 25.4% by March 2019, indicative of improved efficiency in generating profits from equity. From this peak, ROE slightly declines but remains relatively stable near 20-22% through to mid-2021, before experiencing a further gradual decrease in late 2021 and 2022, falling below 15% by year-end 2022. This trend suggests a reduced rate of return on equity during more recent periods, consistent with the reduction in net income observed.
- Net Income
- Initial growth with volatility, a sharp dip in late 2017, followed by a substantial recovery peaking in early 2021, and a significant downward trend in late 2021 through 2022.
- Shareholders’ Equity
- Consistent growth across the entire period, more than doubling from 2016 to 2022, indicating strong capitalization and growth in retained earnings.
- Return on Equity (ROE)
- Improved profitability efficiency peaking near 25% in early 2019, then a gradual decline through 2021 and 2022, reflecting reduced net income relative to equity.
In summary, the data portrays a company with a robust equity base that has grown significantly, supporting net income generation despite periods of volatility. The declining ROE towards the end of the period may warrant attention regarding operational efficiency or market conditions impacting profitability.
Return on Assets (ROA)
Parker-Hannifin Corp., ROA calculation (quarterly data)
| 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 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | Sep 30, 2016 | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||||||||||||||||||||||||||||||
| Net income attributable to common shareholders | ||||||||||||||||||||||||||||||||||
| 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-Q (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-K (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-K (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-K (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-Q (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-K (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-Q (reporting date: 2018-12-31), 10-Q (reporting date: 2018-09-30), 10-K (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-Q (reporting date: 2017-09-30), 10-K (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-Q (reporting date: 2016-12-31), 10-Q (reporting date: 2016-09-30).
1 Q2 2023 Calculation
ROA = 100
× (Net income attributable to common shareholdersQ2 2023
+ Net income attributable to common shareholdersQ1 2023
+ Net income attributable to common shareholdersQ4 2022
+ Net income attributable to common shareholdersQ3 2022)
÷ Total assets
= 100 × ( + + + )
÷ =
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals several notable trends in profitability and asset management over the examined period.
- Net Income Attributable to Common Shareholders
- The net income demonstrates considerable volatility across the quarters. Initially, net income exhibited moderate levels around 210,000 to 290,000 thousand US dollars from late 2016 through 2017, with a significant drop in December 2017 to approximately 56,000 thousand. Subsequently, there was a marked recovery and increase, peaking around 411,000 to 375,000 thousand in early to late 2018. The figures remained relatively high during 2019 and the first half of 2020, fluctuating mostly between 204,000 and 367,000 thousand.
- From late 2020, net income generally increased, reaching a peak of over 500,000 thousand in mid-2021. However, the last quarters show a downward trajectory, with a substantial decline occurring by the end of 2022, dropping to approximately 128,000 thousand before a slight recovery in the last recorded quarter.
- Total Assets
- Total assets increased steadily over the period, starting from approximately 11.9 billion US dollars in late 2016 to over 30.5 billion by the end of 2022. This consistent asset growth indicates ongoing expansion or asset acquisition strategies. A mild fluctuation can be observed around 2018, where total assets slightly decreased before continuing the upward trend.
- Return on Assets (ROA)
- ROA data begins in March 2017 and shows an initial increase from 6.35% to around 9.38% by early 2019, reflecting improved efficiency in generating income from assets during that interval. After 2019, ROA trends downward, with minor fluctuations, falling to below 5% by the final quarters of 2022.
- This declining ROA in the context of growing total assets suggests diminishing returns from asset investments or potentially increasing asset base not matched by proportional income gains in the latter quarters.
Overall, the data depict intermittent strong earnings performance with significant swings in net income, while the asset base consistently expands. The initial improvement in asset profitability reversed in recent periods, highlighting possible challenges in maintaining efficient asset utilization amid growth. The declining ROA concurrent with a steep fall in net income towards the end of 2022 merits further investigation to understand underlying causes.