DXP Enterprises Inc (DXPE)
Profitability ratios
Return on sales
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 30.87% | 30.10% | 28.50% | 29.49% | 27.78% |
| Operating profit margin | 8.07% | 8.30% | 4.37% | 1.18% | 1.02% |
| Pretax margin | 4.72% | 5.18% | 4.45% | 1.72% | -4.73% |
| Net profit margin | 3.91% | 4.10% | 3.25% | 1.48% | -2.89% |
Based on the provided data, we can analyze DXP Enterprises Inc's profitability ratios over the five-year period.
1. Gross Profit Margin:
- The gross profit margin indicates the percentage of revenue that exceeds the cost of goods sold.
- DXP Enterprises Inc's gross profit margin has shown a generally increasing trend, from 27.78% in 2020 to 30.87% in 2024.
- This improvement signifies the company's ability to manage its production and selling costs effectively, resulting in higher profitability at the gross level.
2. Operating Profit Margin:
- The operating profit margin reflects the percentage of revenue remaining after deducting operating expenses.
- DXP Enterprises Inc's operating profit margin has experienced fluctuations but has shown an overall positive trend, increasing from 1.02% in 2020 to 8.07% in 2024.
- The significant improvement in operating profit margin indicates better cost control and operational efficiency by the company.
3. Pretax Margin:
- The pretax margin represents the percentage of revenue that translates to profit before taxes.
- DXP Enterprises Inc's pretax margin has shown an increasing trend, from -4.73% in 2020 to 4.72% in 2024.
- The positive pretax margins reflect the company's ability to generate profits before tax expenses and signify improved financial performance over the years.
4. Net Profit Margin:
- The net profit margin measures the percentage of revenue that remains as profit after all expenses, including taxes.
- DXP Enterprises Inc's net profit margin has shown an increasing trend, from -2.89% in 2020 to 3.91% in 2024.
- The consistent improvement in net profit margin indicates the company's ability to generate higher profits for its shareholders after all expenses are accounted for.
In conclusion, DXP Enterprises Inc has shown positive trends in its profitability ratios over the five-year period, reflecting improvements in cost management, operational efficiency, and overall financial performance.
Return on investment
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 10.77% | 11.83% | 6.24% | 1.45% | 1.20% |
| Return on assets (ROA) | 5.22% | 5.84% | 4.64% | 1.82% | -3.41% |
| Return on total capital | 35.22% | 36.58% | 26.01% | 11.23% | -7.99% |
| Return on equity (ROE) | 16.65% | 18.07% | 13.18% | 4.60% | -8.38% |
Based on the provided data, let's analyze the profitability ratios of DXP Enterprises Inc:
1. Operating Return on Assets (Operating ROA): This ratio indicates the company's operating efficiency in generating profits from its assets. DXP Enterprises Inc's Operating ROA has shown a positive trend from 1.20% in 2020 to 10.77% in 2024, with a significant increase over the years, implying improved operational performance and asset utilization.
2. Return on Assets (ROA): ROA measures the overall profitability of the company in generating earnings from its assets. DXP Enterprises Inc's ROA has also demonstrated a positive trend, improving from -3.41% in 2020 to 5.22% in 2024. This indicates that the company has been more efficient in generating profits using its total assets over the years.
3. Return on Total Capital: This ratio evaluates the returns generated from all sources of capital invested in the company. DXP Enterprises Inc's Return on Total Capital has shown substantial growth, increasing from -7.99% in 2020 to 35.22% in 2024. This signifies efficient capital allocation and enhanced profitability over the period.
4. Return on Equity (ROE): ROE measures the returns earned by the company on shareholders' equity. DXP Enterprises Inc's ROE has displayed a positive trajectory, rising from -8.38% in 2020 to 16.65% in 2024. This indicates that the company has been successful in increasing shareholder value and improving profitability relative to equity investments.
Overall, the profitability ratios of DXP Enterprises Inc have shown a positive trend over the years, reflecting improved operational efficiency, better asset utilization, effective capital management, and enhanced returns for shareholders.