Walt Disney Co. (NYSE:DIS)

Return on Assets (ROA)

The ROA exhibited a decline starting from 5.7% and 5.16% in the periods before March 28, 2020, dropping further into negative territory by June 27, 2020 at -0.53%. This negative trend deepened with values reaching as low as -2.45% by January 2, 2021, followed by a gradual recovery beginning in July 3, 2021, where the ROA moved back into positive figures. From January 1, 2022, through the latest period ending March 29, 2025, the ROA generally increased, reflecting improving asset utilization, peaking at 4.55% on December 28, 2024 and ending at 4.55% in the last reported quarter. This pattern indicates a recovery phase following a period of underperformance likely linked to external adverse conditions.

Financial Leverage

Financial leverage ratios remained relatively stable across the periods, with an initial increase to 2.42 during June 27, 2020, followed by a slow and steady decline over subsequent quarters. The ratio decreased from 2.4 in January 2, 2021 to 1.88 by the end of the latest period reported, March 29, 2025. This trend suggests a moderate reduction in reliance on debt financing over time, potentially reflecting efforts to strengthen the capital structure and reduce financial risk.

Return on Equity (ROE)

The ROE mirrored the trend seen in ROA, starting at 12.44% and 11.56% in the earlier periods, before declining sharply into negative values reaching -5.89% by January 2, 2021. Following this trough, ROE showed consistent improvement, returning to positive figures from July 3, 2021 onward. Over the subsequent quarters, it continued to increase, reaching 8.54% at the final recorded period. This recovery trajectory indicates strengthening profitability from shareholders’ equity after a significant downturn, in line with improving operational and financial performance.

Net Profit Margin

The net profit margin shows significant volatility over the observed periods. Starting with positive values around 15.89% to 13.8% in late 2019 and early 2020, it declines sharply into negative territory from -1.58% to as low as -8.15% between late 2019 and mid-2021. Following this low point, the margin recovers gradually, returning to positive figures by late 2021 and continuing a moderate upward trend through 2024, reaching 9.47% by the end of the last period. This pattern suggests initial profitability disruption followed by a steady recovery phase.

Asset Turnover

Asset turnover remains relatively stable and exhibits a slight upward trend throughout the timeline. Early recorded ratios around 0.36 to 0.37 experience a minor dip to approximately 0.29 during 2020, coinciding with other declines in profitability metrics. Subsequently, asset turnover increases steadily, reaching 0.48 by late 2024. This indicates improving efficiency in the utilization of assets to generate revenue over time, particularly after recovering from a temporary decline.

Financial Leverage

Financial leverage demonstrates a gradual decrease over the periods. Starting from a higher ratio near 2.38, it declines consistently to about 1.88 by the last period in 2024. This trend points to a reduction in the use of debt relative to equity, which may reflect a shift toward a more conservative capital structure or efforts to decrease financial risk.

Return on Equity (ROE)

Return on equity follows a trajectory similar to net profit margin, reflecting the company's profitability relative to shareholder equity. ROE starts with strong positive values near 12.44% and declines sharply into negative figures between early 2020 and mid-2021, with the lowest points ranging from approximately -1.28% to -5.89%. From late 2021 onward, ROE recovers progressively, stabilizing in the range of 2% to almost 9% by late 2024. This recovery aligns with improvements in net profit margin and asset turnover, despite the decreasing financial leverage.

The analysis focuses on three key financial ratios over multiple quarterly periods: Net Profit Margin, Asset Turnover, and Return on Assets (ROA).

Net Profit Margin

The Net Profit Margin exhibits significant fluctuations throughout the observed quarters. Initially, starting from a positive value of 15.89%, it demonstrates a declining trend down to negative territory by the quarters ending September 28, 2019 (-1.58%) and continuing through April 3, 2021 (-8.15%). Following this dip, the margin recovers gradually from negative margins toward positive, reaching 1.77% by October 2, 2021, and continuing an upward trend thereafter. By December 28, 2024, the Net Profit Margin achieves 6.07%, and further improves sharply to 9.47% by the final period recorded, March 29, 2025. This pattern indicates an initial period of profitability contraction, likely influenced by adverse economic or operational conditions, followed by a period of recovery and strengthening profit margins.

Asset Turnover

Asset Turnover demonstrates relative stability with a mild upward trajectory. Starting at 0.36 in December 28, 2019, it experiences a slight decrease during 2020, reaching a trough of 0.29 by July 3, 2021, indicating reduced efficiency in asset utilization. Subsequently, the ratio progressively increases, evidencing improved management of assets to generate revenue. By March 29, 2025, the Asset Turnover ratio reaches 0.48, reflecting steady improvement in asset use efficiency over the long term.

Return on Assets (ROA)

The Return on Assets follows a trend roughly paralleling the Net Profit Margin. From a starting point of 5.7% in December 28, 2019, ROA declines into negative values through mid-2020, bottoming near -2.45% by April 3, 2021. From there, it gradually recovers positive ground, reaching 0.56% by October 2, 2021. An overall upward progression continues with minor fluctuations, culminating in a significant increase to 4.55% by March 29, 2025. This recovery highlights enhanced overall asset profitability after a period of contraction.

In summary, all three ratios indicate a period of financial stress reflected in decreased profit margins and asset returns around 2020, likely coinciding with broader market or operational challenges. Recovery trends from late 2021 onward suggest improved profitability and efficiency. Asset Turnover’s gradual increase supports the notion of better asset management, while the positive reversal in Profit Margin and ROA underscores a return to stronger earnings performance. The overall trends are indicative of resilience and progressive operational improvement through the latest periods analyzed.