Elevance Health Inc (ELV)
Profitability ratios
Return on sales
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 88.83% | 27.44% | 25.51% | 25.96% | 27.75% |
| Operating profit margin | 4.47% | 5.10% | 5.40% | 6.45% | 6.33% |
| Pretax margin | 4.47% | 4.50% | 4.85% | 5.72% | 5.12% |
| Net profit margin | 3.38% | 3.49% | 3.76% | 4.40% | 3.75% |
Elevance Health Inc's profitability ratios have shown some fluctuations over the years. The gross profit margin declined from 27.75% in 2020 to 25.51% in 2022, before experiencing a significant increase to 88.83% in 2024. This suggests that the company improved its efficiency in generating revenue after accounting for the cost of goods sold in 2024.
The operating profit margin, which indicates the company's ability to control operating expenses, decreased slightly from 6.33% in 2020 to 4.47% in 2024. This may indicate challenges in cost management or pricing strategies.
The pretax margin, representing profits before taxes, also exhibited a downward trend from 5.12% in 2020 to 4.47% in 2024. This may indicate that the company faced increasing tax burdens or other non-operating expenses impacting profitability.
The net profit margin, which reflects the company's bottom-line profitability, declined from 3.75% in 2020 to 3.38% in 2024. This suggests that after accounting for all expenses, including taxes, the company's profit as a percentage of revenue decreased over the years.
Overall, Elevance Health Inc needs to focus on improving operational efficiency, controlling costs, and optimizing revenue generation to enhance its 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) | 6.76% | 8.03% | 8.22% | 9.18% | 8.90% |
| Return on assets (ROA) | 5.12% | 5.50% | 5.74% | 6.26% | 5.28% |
| Return on total capital | 18.63% | 22.25% | 23.32% | 13.04% | 21.15% |
| Return on equity (ROE) | 14.47% | 15.23% | 16.26% | 16.93% | 13.77% |
Elevance Health Inc's profitability ratios demonstrate a stable performance over the years, with some fluctuations in key metrics.
1. Operating Return on Assets (Operating ROA):
- The Operating ROA shows the company's ability to generate profit from its operations relative to its assets.
- Elevance Health saw a slight increase in Operating ROA from 8.90% in 2020 to 9.18% in 2021, followed by a decline to 8.22% in 2022 and 8.03% in 2023, and further to 6.76% in 2024.
- While the Operating ROA initially improved, the downward trend in recent years indicates a potential inefficiency in generating profits from its assets.
2. Return on Assets (ROA):
- The ROA indicates how efficiently the company is utilizing its assets to generate profit.
- Elevance Health's ROA increased from 5.28% in 2020 to 6.26% in 2021, followed by a slight decline to 5.74% in 2022, 5.50% in 2023, and 5.12% in 2024.
- The overall trend shows a positive performance compared to the Operating ROA, but the decreasing trend towards the later years may indicate a slowdown in asset efficiency.
3. Return on Total Capital:
- This ratio measures the return earned on all capital invested in the company, including both debt and equity.
- Elevance Health experienced a significant decrease in Return on Total Capital from 21.15% in 2020 to 13.04% in 2021. However, there was a notable recovery to 23.32% in 2022, followed by relatively stable figures of 22.25% in 2023 and 18.63% in 2024.
- The company's ability to generate returns on capital has shown variability over time, with a notable rebound in 2022.
4. Return on Equity (ROE):
- ROE reflects the profit generated for each dollar of shareholders' equity.
- Elevance Health's ROE increased from 13.77% in 2020 to 16.93% in 2021, followed by a relatively consistent performance with figures of 16.26% in 2022, 15.23% in 2023, and 14.47% in 2024.
- The ROE indicates a relatively stable return on equity, reflecting a reasonable performance in generating profits for shareholders.
Overall, Elevance Health's profitability ratios highlight a mix of positive and challenging trends in asset efficiency and capital utilization, suggesting a need for monitoring and potentially optimizing the company's operational and financial strategies to enhance profitability in the future.