Chemed Corp (CHE)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 17.38% | 18.56% | 18.37% | 17.37% | 15.86% |
| Operating profit margin | 15.04% | 16.09% | 16.04% | 18.74% | 13.28% |
| Pretax margin | 15.47% | 15.44% | 16.38% | 19.04% | 13.50% |
| Net profit margin | 12.03% | 11.69% | 12.55% | 15.36% | 11.34% |
Chemed Corp.'s profitability ratios have shown a mixed trend over the past five years. The gross profit margin has remained relatively stable, ranging from 31.85% in 2019 to 35.98% in 2021, indicating consistent control over the cost of goods sold. However, there was a slight decline in 2023 to 35.28%.
The operating profit margin has also been quite steady, fluctuating between 13.75% in 2019 and 16.26% in 2022. This indicates efficient management of operating expenses to generate profits. In 2023, there was a decrease to 15.14%, which may warrant further investigation into cost management strategies.
The pretax margin fluctuated more significantly, with a peak of 19.04% in 2020 and a low of 13.50% in 2019. This suggests that Chemed Corp. has experienced variability in its earnings before taxes. The 2023 pretax margin of 15.47% falls within this range.
The net profit margin, representing bottom-line profitability, has shown a similar variability, with a high of 15.36% in 2020 and a low of 11.34% in 2019. The 2023 net profit margin of 12.03% indicates a moderate level of profitability.
Overall, Chemed Corp. has generally maintained solid profitability ratios, demonstrating efficient cost management and a reasonable level of profitability. However, the recent slight declines in some margins warrant monitoring to ensure continued financial health and sustainability.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 20.42% | 23.82% | 25.55% | 27.16% | 20.29% |
| Return on assets (ROA) | 16.34% | 17.31% | 20.00% | 22.26% | 17.34% |
| Return on total capital | 31.91% | 37.51% | 43.57% | 44.20% | 32.59% |
| Return on equity (ROE) | 24.60% | 31.25% | 43.09% | 35.45% | 30.27% |
Chemed Corp. has shown a consistent trend of profitability over the past five years based on the provided data.
Starting with the Operating Return on Assets (Operating ROA), the company's performance in generating operating income from its total assets has been strong, with a slight decrease from 25.62% in 2021 to 20.55% in 2023. This indicates that Chemed Corp. has been effectively utilizing its assets to generate operating profits, although there has been a slight decline in recent years.
Moving on to the Return on Assets (ROA), we see a similar trend of strong performance, with a high of 22.26% in 2020. However, there has been a slight decrease to 16.34% in 2023. This indicates that the company's net income relative to its total assets has decreased over the past few years.
When analyzing the Return on Total Capital, Chemed Corp. has consistently shown a high return on its total capital, reaching a peak of 42.56% in 2021. The company's ability to generate profits from both debt and equity investments is notable, indicating efficient capital allocation.
Finally, looking at the Return on Equity (ROE), we see a similar trend of strong performance, with a high of 43.09% in 2021. The company's ability to generate a return on shareholder equity has been impressive, although there was a slight decrease to 24.60% in 2023.
Overall, Chemed Corp. has demonstrated strong profitability ratios over the years, indicating effective management of assets, capital, and equity to generate returns for its stakeholders.