Cognex Corporation (CGNX)
Profitability ratios
Return on sales
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 68.32% | 72.85% | 71.89% | 73.43% | 74.37% |
| Operating profit margin | 12.56% | 15.84% | 24.52% | 30.45% | 20.98% |
| Pretax margin | 14.36% | 16.40% | 24.96% | 30.82% | 22.99% |
| Net profit margin | 11.59% | 13.72% | 21.46% | 27.05% | 21.67% |
Cognex Corporation's profitability ratios show a varied trend over the five-year period.
- The gross profit margin decreased from 74.37% in December 31, 2020, to 68.32% in December 31, 2024. This indicates a decline in the company's ability to generate profit from sales after accounting for the cost of goods sold.
- The operating profit margin increased from 20.98% in December 31, 2020, to 30.45% in December 31, 2021, before gradually decreasing to 12.56% in December 31, 2024. This suggests that the company's ability to generate profit from its core operations was initially strong but faced challenges in maintaining profitability over the years.
- The pretax margin followed a similar trend, starting at 22.99% in December 31, 2020, peaking at 30.82% in December 31, 2021, and then declining to 14.36% in December 31, 2024. This indicates fluctuations in the company's profitability before taxes.
- The net profit margin also showed a decline from 21.67% in December 31, 2020, to 11.59% in December 31, 2024. This suggests a decrease in the company's ability to convert revenue into profit after accounting for all expenses.
Overall, Cognex Corporation's profitability has shown some volatility over the five-year period, with declines in gross, operating, pretax, and net profit margins. This may indicate challenges in cost management, pricing strategies, or operational efficiencies that the company may need to address to enhance its overall profitability in the future.
Return on investment
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 5.77% | 6.48% | 12.57% | 15.73% | 9.47% |
| Return on assets (ROA) | 5.33% | 5.61% | 11.01% | 13.97% | 9.78% |
| Return on total capital | 7.58% | 8.69% | 17.12% | 22.03% | 13.51% |
| Return on equity (ROE) | 7.00% | 7.53% | 14.98% | 19.57% | 13.96% |
Over the five-year period from December 31, 2020, to December 31, 2024, Cognex Corporation's profitability ratios displayed some fluctuations.
1. Operating return on assets (Operating ROA):
- The Operating ROA increased from 9.47% in 2020 to 15.73% in 2021, indicating improved efficiency in generating operating profits from its assets. However, it decreased to 12.57% in 2022, and further declined to 6.48% in 2023, possibly showing challenges in maintaining profitability levels. In 2024, it saw a slight improvement to 5.77%.
2. Return on assets (ROA):
- The ROA also demonstrated a similar trend, starting at 9.78% in 2020 and peaking at 13.97% in 2021 before declining to 5.33% in 2024. This ratio provides insights into how effectively the company is generating profits from its total assets.
3. Return on total capital:
- The return on total capital peaked at 22.03% in 2021, suggesting efficient utilization of both debt and equity. However, this ratio declined to 7.58% in 2024, indicating a decrease in returns generated from the total capital employed in the business.
4. Return on equity (ROE):
- The ROE showed a similar pattern to the other ratios, with a decrease from 13.96% in 2020 to 7.00% in 2024. This ratio indicates how effectively the company is generating profits from the shareholders' equity invested in the business.
Overall, although there were fluctuations in the profitability ratios over the five-year period, it is essential for Cognex Corporation to focus on maintaining or improving these ratios to ensure sustained profitability and efficiency in utilizing its assets and capital.