Procter & Gamble Co. (NYSE:PG)

The analysis of the quarterly financial ratios indicates notable trends in profitability and financial structure over the periods observed.

Return on Assets (ROA)

ROA values start appearing from June 30, 2019, with a gradual increase from 3.39% to a peak of 12.65% in March 31, 2025. A marked improvement is visible starting in September 30, 2020, when ROA nearly triples compared to earlier values. The ratio stabilizes, maintaining levels mostly above 11% from late 2020 onward. The slight fluctuations observed later remain within a narrow range, indicating consistent asset profitability.

Financial Leverage

The financial leverage ratio remains relatively stable across the entire period. Initial observations start at 2.27, fluctuating mildly between 2.21 and 2.72 without any strong upward or downward trends. Post-2018, leverage peaks around 2.72 in December 31, 2021, then declines gradually to a value near 2.35 by March 31, 2025, indicating a moderate reduction in debt relative to equity over time.

Return on Equity (ROE)

ROE shows a significant upward trend beginning mid-2019, rising from 8.26% to a high of 33.06% in March 31, 2023. After this peak, the ratio experiences a modest decline but remains robust, staying above 27% through March 31, 2025. This suggests strong equity profitability that grew substantially in the early part of the timeline and then maintained high levels with slight variability.

Overall, profitability measured by ROA and ROE improved markedly from mid-2019, reflecting enhanced efficiency and returns for the company over equity and assets. The financial leverage ratio remained stable, with minor declines towards the later stages, indicating prudent management of financial risk amidst growing profitability.

Net Profit Margin

The net profit margin exhibits a notable upward trend beginning from a baseline near 5.76% in September 2019, rising sharply to a peak exceeding 18% during fiscal years 2020 and 2021. This elevated profitability level stabilizes with minor fluctuations between approximately 17% and 18.5% over subsequent quarters through early 2025. This pattern indicates a marked improvement in profitability capacity, followed by a period of relative consistency.

Asset Turnover

Asset turnover ratios start around 0.59 to 0.62 in 2019 and show a gradual but consistent increase over the periods analyzed. By mid-2024, this ratio reaches about 0.69 to 0.7, indicating an incremental improvement in the efficiency of asset usage to generate revenue. The upward trajectory is steady, reflecting continual enhancements in operational efficiency.

Financial Leverage

Financial leverage ratios fluctuate moderately over the timeline, starting near 2.27 in late 2018 and increasing to approximately 2.72 by late 2021. Following this peak, the leverage declines gradually to around 2.35 by early 2025. This suggests a trend of initially increasing reliance on debt or other liabilities to finance assets, which is subsequently reduced, indicating a conservative shift in the capital structure in recent periods.

Return on Equity (ROE)

Return on equity shows a strong upward trend beginning in late 2019, jumping from roughly 8.26% to peak values surpassing 33% at intervals between 2021 and 2023. Post-peak, ROE experiences slight declines but maintains a high level near the low 30% range. This pattern highlights significantly improved returns to shareholders, largely sustained over multiple quarters.

Overall Insights

The combined trends of increasing net profit margin and asset turnover suggest an enhancement both in profitability and asset utilization. While financial leverage initially rises, it later declines, indicating prudent financial management adjustments. The strong and sustained ROE performance reflects successful value creation for equity holders throughout the period analyzed.

The analysis of the quarterly financial ratios reveals several notable trends and patterns over the observed periods.

Tax Burden

The tax burden ratio begins at 0.65 in September 2019 and shows a gradual upward trend, stabilizing around 0.81-0.83 from late 2020 to early 2023. Subsequently, it slightly declines and fluctuates near 0.79-0.80 through to March 2025, indicating a relatively consistent effective tax rate with minor variations in recent periods.

Interest Burden

The interest burden ratio exhibits a steady increase from 0.92 in September 2019 to approximately 0.98 during 2021 and much of 2022, suggesting improved efficiency in managing interest expenses relative to earnings before interest and taxes. In the period from late 2022 to mid-2024, the ratio shows a slight decline to around 0.95-0.96, maintaining a generally high level of coverage of interest costs.

EBIT Margin

EBIT margin experiences a significant jump from values around 9.62% in September 2019 to over 22% in the subsequent quarters. This sharp increase indicates substantial improvement in operating profitability. Following this rise, the margin remains relatively stable in the range of approximately 22% to 24%, reflecting sustained operational efficiency and effective cost management.

Asset Turnover

The asset turnover ratio starts near 0.59-0.62 in the periods before 2020 and gradually improves to about 0.68-0.7 by late 2023. The increase suggests enhanced asset utilization and efficiency in generating revenue from assets. However, there are minor fluctuations, including a slight dip towards mid-2024, but the overall trend reflects progressive improvement.

Financial Leverage

Financial leverage fluctuates moderately between 2.2 and 2.7 over the timeframe. After peaking near 2.72 in late 2021, leverage decreases steadily to around 2.35 by the first quarter of 2025. This reduction in leverage may indicate a cautious approach in managing debt levels or a strategic move toward a more conservative capital structure.

Return on Equity (ROE)

ROE demonstrates a significant upward movement from 8.26% in September 2019 to peaks exceeding 32% during 2021 and 2022. This indicates strong profitability and value creation for shareholders during these periods. From 2023 onward, ROE shows a moderate decline to the range of approximately 27.6% to 30.3%, yet remains considerably high, reflecting continued robust financial performance despite some easing from peak values.

In summary, the company shows substantial improvement in profitability and operational efficiency starting from late 2019, with EBIT margin and ROE notably increasing. Asset turnover grows steadily, indicating better asset utilization. Interest burden ratios improve, which may reflect effective cost control over interest expenses. Financial leverage trends downward after peaking, signaling possible risk reduction in financial structure. Tax burden remains stable with minor fluctuations. Overall, the data reveals a progression toward enhanced financial health and sustainable profitability with occasional adjustments consistent with prudent financial management.

Net Profit Margin

The net profit margin data begins from March 31, 2019. It shows a gradual increase from 5.76% to a peak of 7.09% by June 30, 2019. A significant jump occurs between June 30, 2019, and September 30, 2019, where the margin rises sharply to 18.36%. Following this peak, the net profit margin remains relatively stable, fluctuating slightly within the range of approximately 17.06% to 18.97% through the periods ending up to March 31, 2025. Overall, after the initial spike, the margin exhibits consistent high profitability with minor fluctuations.

Asset Turnover

Asset turnover ratios commence from March 31, 2019, starting at 0.59 and show modest growth with minor variability across the periods. The ratio generally trends upward from 0.59 to around 0.7 by March 31, 2024. Small declines occur intermittently, particularly noticeable toward the later periods where the ratio decreases slightly from 0.7 to 0.66 and then rebounds to 0.69 and 0.68. This indicates a slow but steady improvement in the efficiency of asset utilization, with some cyclical variations.

Return on Assets (ROA)

Return on assets data, available starting March 31, 2019, follows a trend similar to net profit margin. Initial values increase from 3.39% to 4.31% by March 31, 2020. A marked increase then occurs in the quarters ending September 30, 2020, to June 30, 2021, reaching levels above 11% and peaking near 12.65% by March 31, 2024. Following that, slight fluctuations occur but the level remains consistently above 11%, ending close to 12.6% by the last period. This indicates an overall enhancement of asset profitability over time with maintenance of relatively high returns.

Summary

The financial indicators demonstrate a significant improvement in profitability and operational efficiency since early 2019. The net profit margin increased sharply and then stabilized at a high level, reflecting sustained profitability. Asset turnover shows gradual improvement, suggesting better asset usage efficiency. Return on assets aligns with these trends, moving from modest returns to consistently strong levels, indicating effective asset management and overall financial health. The data suggests the company has strengthened its profitability and efficiency metrics over the multi-year period with relatively stable performance in recent quarters.

The financial data reveals several notable trends across the periods analyzed. Key profitability and efficiency ratios show a pattern of improvement over time, with some fluctuations in the later quarters.

Tax Burden

The tax burden ratio begins at 0.65 and gradually increases to a steady range around 0.80 to 0.82, indicating a rising proportion of taxable income retained after taxes. This suggests a more stable or possibly optimized tax expense relative to pre-tax earnings in recent periods.

Interest Burden

Starting at 0.92, the interest burden ratio improves slightly over the periods, reaching near 0.97 to 0.98, and then slightly declining to about 0.95 towards the end. This improvement indicates a modest reduction in interest expenses relative to earnings before interest and taxes, reflecting effective debt management or reduced leverage costs.

EBIT Margin

The EBIT margin shows a significant increase beginning in September 2019, jumping from around 10% to approximately 23%-24% in subsequent quarters. This indicates enhanced operating profitability, driven potentially by improved cost control, pricing strategies, or product mix. The margin remains relatively stable in this higher range through the latest periods.

Asset Turnover

The asset turnover ratio exhibits a slight upward trend, moving from about 0.59 towards a peak of approximately 0.70 before experiencing minor fluctuations. This signals incremental improvements in asset utilization, meaning the company is generating more revenue per dollar of assets over time.

Return on Assets (ROA)

ROA demonstrates substantial growth beginning in late 2019, increasing from around 3.4% to a range between 11% and 12.5% in subsequent periods. This improvement aligns with the increases observed in EBIT margin and asset turnover, indicating stronger overall profitability and efficient asset use. Despite some variation, ROA remains robust near the higher levels through the final recorded quarter.

In summary, the data reflects enhanced operational efficiency and profitability starting in late 2019, with sustained performance in key financial ratios such as EBIT margin, asset turnover, and ROA. The tax burden and interest burden ratios have stabilized at favorable levels, supporting overall financial health. Minor fluctuations in some ratios towards the last quarters suggest the necessity for ongoing monitoring, but the general trajectory indicates sound financial management and improved return generation capabilities.

Tax Burden

The tax burden ratio demonstrates a noticeable increase from 0.65 to approximately 0.83 within the initial periods available, indicating a rising proportion of earnings retained after taxes. From that peak around late 2019 to the most recent periods, the tax burden ratio remains relatively stable, fluctuating slightly around 0.80 to 0.82. This suggests consistent tax management and a stable effective tax rate in the later periods analyzed.

Interest Burden

The interest burden ratio shows gradual improvement over the reported quarters, rising from about 0.92 to values in the range of 0.95 to 0.98. This upward trend indicates a reduction in interest expenses relative to earnings before interest and taxes, reflecting either lower interest costs or stronger operating earnings. The ratio stabilizes near 0.95-0.98 in the latter quarters, suggesting controlled financial costs and effective leverage management.

EBIT Margin

The EBIT margin exhibits a marked increase from approximately 9.62% in early available data to a significant jump around the third quarter of 2019, where it peaks above 22%, roughly doubling from previous levels. Following this sharp rise, the margin remains stable around the 22% to 24% range through to the latest periods, with minor fluctuations. This sustained high operating profitability indicates enhanced operational efficiency or pricing power that maintains earnings before interest and taxes at a strong level relative to sales.

Net Profit Margin

The net profit margin follows a similar pattern to the EBIT margin, starting at around 5.76% and increasing substantially to exceed 18% by late 2019. After reaching this elevated level, the net margin remains relatively stable with minor quarter-to-quarter variability, generally ranging between 17% and 18.5%. This stability reflects effective cost control, tax management, and financing expenses, contributing to consistent bottom-line profitability.