Procter & Gamble Co. (NYSE:PG)

The financial performance over the analyzed quarters indicates several notable trends in the key profitability and leverage metrics.

Return on Assets (ROA)

The ROA figures show a generally stable and slightly upward trend over the period. Beginning at 11.44% in September 2020, the ROA increases with minor fluctuations, reaching 13.14% by September 2025. Variations within this range suggest effective asset utilization with periodic improvements in efficiency or profitability. Notably, ROA peaked around mid-2024 to mid-2025, reflecting enhanced returns from company assets during these quarters.

Financial Leverage

The financial leverage ratio exhibits modest variability without a clear upward or downward long-term trend. Starting at 2.49 in September 2020, leverage gradually rose to a peak of 2.72 in December 2021, followed by a decline to around 2.39 by March 2024. Subsequent quarters show slight oscillations stabilizing near 2.40 by September 2025. This pattern indicates periodic adjustments in debt financing relative to equity, with a peak in leverage around late 2021 possibly signaling more aggressive use of debt financing, later moderated in subsequent years.

Return on Equity (ROE)

ROE demonstrates a strong and generally increasing trend with some short-term fluctuations. It rose from 28.46% in September 2020 to a high of 33.06% in September 2022, marking a period of heightened profitability relative to shareholders' equity. Although some decreases followed, ROE remained robust, fluctuating mostly between 29% and 32%, and reaching 31.47% by September 2025. The sustained high ROE values suggest effective management of equity capital and consistent generation of shareholder value over the evaluated period.

Overall, the data reflects a company maintaining strong profitability metrics, with ROA and ROE showing upward momentum over time. Financial leverage has been managed within a relatively narrow band, indicating cautious but flexible use of debt financing. The trends suggest balanced growth with a focus on maximizing returns while controlling leverage.

The analysis of the quarterly financial data reveals several notable trends across the key financial ratios of the company over the observed periods.

Net Profit Margin

The net profit margin demonstrated a slight declining trend from around 18.9% in late 2020 to a low point near 17.6% by the end of 2023. Following this trough, the margin experienced a gradual recovery, reaching approximately 19.7% by the third quarter of 2025. This pattern indicates a moderate compression in profitability in the initial years, followed by a steady improvement toward the end of the timeframe.

Asset Turnover

The asset turnover ratio displayed a gradual and consistent increase from 0.60 in September 2020 to a peak of around 0.70 in late 2023 and mid-2024. Subsequently, the ratio stabilized somewhat, fluctuating narrowly around 0.66 to 0.68 through the third quarter of 2025. This suggests an overall improvement in the efficiency with which assets generate revenue, peaking before a modest stabilization phase.

Financial Leverage

Financial leverage ratios rose slightly from about 2.49 in late 2020 to a local maximum of approximately 2.72 in December 2021. Thereafter, leverage trends declined steadily to near 2.4 by the end of 2024 and remained relatively stable through mid-2025. This indicates a cautious deleveraging strategy or reduction in reliance on debt financing over recent periods.

Return on Equity (ROE)

ROE exhibited an increasing trend from 28.5% in September 2020 to a peak above 33% around the third quarter of 2022. Following this peak, ROE declined to a low point near 27.6% in late 2024, before recovering to nearly 31.5% by the third quarter of 2025. The fluctuations in ROE reflect a combination of operational profitability, asset use efficiency, and leverage movements over time, with a notable upward momentum late in the period under review.

Overall, the company experienced moderate profitability pressure in net margin early in the period, offset by improved asset efficiency and fluctuating financial leverage. The rebound in profit margin and sustained improvement in ROE toward the end of the timeline points to enhanced financial performance, supported by effective asset utilization and managed leverage. The stability in financial leverage and asset turnover ratios in the recent quarters suggests a balanced approach to growth and risk management.

Tax Burden

The tax burden ratio displayed a relatively stable trend over the analyzed periods, fluctuating narrowly around 0.80 to 0.82. There is a subtle downward inclination from approximately 0.82 in 2020 to about 0.79-0.80 in the later periods, indicating marginal improvements in tax efficiency or reduced effective tax rates over time.

Interest Burden

The interest burden ratio remained consistently high, close to 0.95 to 0.98 throughout the quarters. This stability implies steady interest expenses relative to earnings before interest and taxes, reflecting stable financing costs and controlled interest obligations across the years.

EBIT Margin

The EBIT margin (%) showed moderate variability but a generally positive trend. Initial margins around 23.7% in 2020 dipped slightly below 23% in mid-2021, but from 2022 onward, margins have improved steadily, reaching around 25.7% by late 2025. This indicates improving operating profitability, potentially driven by operational efficiencies or pricing strategies.

Asset Turnover

Asset turnover ratios increased from 0.60 in late 2020 to peaks near 0.70 during the 2023 and mid-2024 periods, reflecting enhanced efficiency in using assets to generate sales. A slight decline is observable towards the latter periods, but ratios generally remained above earlier levels, suggesting an overall improvement in asset utilization.

Financial Leverage

Financial leverage exhibited a decreasing trend from a high around 2.72 in late 2021 to approximately 2.35-2.40 in recent quarters. This downward movement suggests a reduction in the use of debt relative to equity, implying a potentially more conservative capital structure or debt repayment initiatives undertaken by management over time.

Return on Equity (ROE)

ROE demonstrated fluctuation with an upward trend early on, peaking around 33% in late 2022. Following this peak, ROE moderated to the high 20% to low 30% range by 2024, before exhibiting a moderate recovery near 31.5% towards late 2025. The overall level of ROE indicates strong profitability and effective equity use, with fluctuations likely driven by changes in operating performance, asset turnover, and leverage.

Net Profit Margin

The net profit margin exhibited a generally stable trend with minor fluctuations throughout the observed periods. Starting at 18.92% in the third quarter of 2020, it experienced a gradual decline to around 17.69% by the first quarter of 2023. Following this reduction, the margin showed a recovery trend, climbing back to 19.74% by the third quarter of 2025. Overall, the margin remained within a narrow range of approximately 17.0% to 19.7%, indicating consistent profitability levels with slight improvements toward the end of the period.

Asset Turnover

Asset turnover demonstrated an upward progression from 0.60 in the third quarter of 2020 to a peak level of approximately 0.70 in several quarters between late 2023 and early 2025. This indicates an increase in the efficiency of asset utilization over time. The metric showed some minor declines after peaks but remained relatively steady around the 0.66 to 0.70 range in the later periods, signifying sustained operational efficiency in generating sales from assets.

Return on Assets (ROA)

ROA showed a positive and slightly upward trend, beginning at 11.44% in the third quarter of 2020, increasing steadily to reach peaks above 12.5% during mid-2022 and again from early 2024 onwards. Despite some modest dips, the ROA maintained a generally upward trajectory, culminating in 13.14% by the third quarter of 2025. This suggests improving effectiveness in using asset base to generate net income over the observed timeframe.

Overall Analysis

The financial ratios reflect a company with consistent profitability, improving asset efficiency, and a strengthening ability to generate returns on its assets. The initial phase showed slight margins pressure and moderate asset usage, but these metrics improved steadily. The simultaneous increase in asset turnover and ROA suggests operational enhancements and better asset management. The rebound and growth in net profit margin toward the final periods signals an improved cost structure or pricing power, contributing to overall financial robustness.

Tax Burden

The tax burden ratio remained relatively stable over the observed periods, hovering around 0.80 to 0.82. There was a slight gradual decline from 0.82 in late 2020 to approximately 0.79 in early 2024, followed by stabilization near 0.80 through mid-2025. This indicates a consistent effective tax rate with minor fluctuations.

Interest Burden

The interest burden ratio showed minimal variation, consistently staying between 0.95 and 0.98. A marginal decrease is notable from about 0.98 in 2021 to 0.95 in 2024, suggesting a slight reduction in interest expense relative to earnings before interest and taxes. The ratio then stabilized in the 0.95 to 0.96 range by mid-2025.

EBIT Margin

The EBIT margin exhibited modest fluctuations throughout the periods. Initially ranging near 23.7%, it declined slightly to around 22.4% by the end of 2022, before rebounding to higher levels reaching approximately 25.7% by the third quarter of 2025. This trend reflects an overall improvement in operational profitability with temporary softness in late 2022.

Asset Turnover

Asset turnover showed a gradual upward trend from 0.60 in late 2020 to about 0.70 by early 2024, indicating improved efficiency in using assets to generate sales. Thereafter, minor fluctuations occurred with a slight decrease to 0.66 around late 2024, followed by stabilization around 0.67 by mid-2025.

Return on Assets (ROA)

The ROA improved steadily from 11.44% in late 2020 to a peak of approximately 13.14% by the third quarter of 2025. Despite minor dips, the overall trend suggests enhanced profitability and asset utilization. Periodic volatility appears linked with changes in EBIT margin and asset turnover but maintains an upward trajectory over time.

The financial ratios present consistent trends over the observed periods, reflecting stable operational and financial performance.

Tax Burden

The tax burden ratio remains relatively stable around 0.80 to 0.82, with minor fluctuations. This indicates a consistent effective tax rate relative to pretax income, with no significant changes impacting the net profitability through tax expenses over time.

Interest Burden

Interest burden ratios slightly decreased from approximately 0.97–0.98 in the earlier periods to about 0.95–0.96 in the later periods. This small decline suggests a modest increase in interest expenses relative to earnings before interest and taxes, potentially indicating a slight increase in leverage or interest costs, although still maintaining a strong capacity to cover interest obligations.

EBIT Margin

The EBIT margin shows some variability, starting at roughly 23.7% and exhibiting a downward trend into the early 2022 data, reaching lows near 22.4%. Subsequently, a gradual recovery is evident, increasing to above 24%, and ultimately reaching a peak of approximately 25.7% by the last reported period. This trend reflects an overall improvement in operational efficiency or pricing power, enhancing earnings before interest and taxes as a percentage of revenue.

Net Profit Margin

Net profit margins mirror the EBIT margin movement with initial declines from about 18.9% to under 18% during the midperiod. Later, margins gradually rebound, rising to near 19.7% in the most recent quarters. Although slightly more volatile, the net margin improvements suggest effective cost control, stable tax impacts, and manageable interest expenses contributing to improved bottom-line profitability over time.

In summary, the data indicate steady tax and interest burdens, with key profitability ratios (EBIT and net profit margins) displaying initial pressure followed by a consistent recovery and strengthening through the later periods. This reflects an overall positive trend in operational profitability and financial management.