GMS Inc (GMS)
Profitability ratios
Return on sales
| Apr 30, 2025 | Jan 31, 2025 | Oct 31, 2024 | Jul 31, 2024 | Apr 30, 2024 | Jan 31, 2024 | Oct 31, 2023 | Jul 31, 2023 | Apr 30, 2023 | Jan 31, 2023 | Oct 31, 2022 | Jul 31, 2022 | Apr 30, 2022 | Jan 31, 2022 | Oct 31, 2021 | Jul 31, 2021 | Apr 30, 2021 | Jan 31, 2021 | Oct 31, 2020 | Jul 31, 2020 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Gross profit margin | 31.23% | 30.78% | 30.59% | 30.82% | 31.02% | 31.81% | 32.33% | 32.38% | 32.39% | 32.26% | 32.10% | 32.05% | 32.11% | 32.01% | 32.12% | 32.16% | 32.21% | 32.52% | 32.74% | 32.85% |
| Operating profit margin | 4.67% | 5.36% | 6.85% | 7.45% | 8.11% | 8.50% | 8.83% | 9.34% | 9.48% | 9.55% | 9.57% | 9.28% | 9.04% | 8.44% | 7.67% | 6.63% | 5.79% | 3.10% | 3.02% | 3.13% |
| Pretax margin | 3.16% | 3.87% | 5.42% | 6.11% | 6.80% | 7.22% | 7.61% | 8.17% | 8.40% | 8.51% | 8.53% | 8.18% | 7.87% | 7.10% | 6.26% | 5.13% | 4.16% | 1.87% | 1.60% | 1.59% |
| Net profit margin | 2.09% | 2.61% | 3.92% | 4.45% | 5.02% | 5.48% | 5.74% | 6.14% | 6.25% | 6.28% | 6.32% | 6.09% | 5.90% | 5.39% | 4.78% | 3.94% | 3.20% | 0.97% | 0.80% | 0.81% |
The profitability ratios of GMS Inc. from July 2020 through October 2025 reveal certain trends and insights into the company's operational efficiency and overall profitability over the period.
Gross Profit Margin has remained relatively stable with a slight decline over the years. Starting at approximately 32.85% in July 2020, the gross margin experienced minor fluctuations but exhibited a gradual downward trend, reaching around 30.59% by October 2024. Despite these declines, the gross margin in April 2025 slightly increased to approximately 31.23%, indicating some recovery. This stability suggests that GMS Inc. has maintained consistent pricing strategies and cost control at the gross profit level, though margin compression may have been experienced, possibly due to competitive pressures or input cost increases.
Operating Profit Margin exhibits a more pronounced downward trend over the period. It began at approximately 3.13% in July 2020 and increased temporarily to a peak of 9.57% in October 2022, reflecting operational improvements during that period. However, from 2022 onwards, there has been a steady decline, reaching around 4.67% in April 2025. This suggests increasing operating expenses or decreasing operational efficiency, which has impacted the company’s ability to sustain higher operating margins.
Pre-tax Margin follows a similar pattern, starting at approximately 1.59% in July 2020, rising to over 8.53% in October 2022, and then declining to roughly 3.16% by April 2025. The initial growth indicates improved pre-tax profitability possibly due to operational efficiencies or favorable market conditions, whereas the subsequent decline reflects deteriorating pre-tax profitability, likely influenced by rising costs or lower revenues.
Net Profit Margin shows a consistent downward trend throughout the period. Beginning at approximately 0.81% in July 2020, it rose to about 6.32% in October 2022, then declined sharply to approximately 2.09% as of April 2025. The net margin contraction points toward increasing expense pressures, potentially from higher interest expenses, tax impacts, or other non-operating costs affecting net profitability.
Overall, GMS Inc.’s profitability ratios indicate a period of initial improvement in margins up until late 2022, succeeded by a sustained decline. This pattern suggests that while operational performance was strong in the earlier years, recent years have been characterized by margin compression across gross, operating, pre-tax, and net profitability measures, likely reflecting increased costs and competitive or market pressures impacting the company’s bottom line.
Return on investment
| Apr 30, 2025 | Jan 31, 2025 | Oct 31, 2024 | Jul 31, 2024 | Apr 30, 2024 | Jan 31, 2024 | Oct 31, 2023 | Jul 31, 2023 | Apr 30, 2023 | Jan 31, 2023 | Oct 31, 2022 | Jul 31, 2022 | Apr 30, 2022 | Jan 31, 2022 | Oct 31, 2021 | Jul 31, 2021 | Apr 30, 2021 | Jan 31, 2021 | Oct 31, 2020 | Jul 31, 2020 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 6.72% | 7.90% | 9.52% | 10.61% | 11.87% | 14.01% | 14.30% | 15.22% | 15.46% | 15.69% | 15.43% | 14.30% | 13.49% | 11.71% | 10.52% | 8.81% | 7.69% | 4.32% | 4.30% | 4.49% |
| Return on assets (ROA) | 3.01% | 3.84% | 5.45% | 6.33% | 7.34% | 9.03% | 9.30% | 10.01% | 10.19% | 10.33% | 10.18% | 9.39% | 8.81% | 7.48% | 6.56% | 5.24% | 4.25% | 1.35% | 1.14% | 1.16% |
| Return on total capital | 14.26% | 21.55% | 25.93% | 27.96% | 30.39% | 32.60% | 34.89% | 37.57% | 40.19% | 41.68% | 42.94% | 41.03% | 40.17% | 36.75% | 31.80% | 27.19% | 23.47% | 14.89% | 15.31% | 16.76% |
| Return on equity (ROE) | 8.13% | 10.46% | 14.91% | 16.77% | 18.90% | 20.81% | 22.40% | 24.38% | 26.12% | 27.13% | 27.92% | 26.48% | 25.69% | 22.99% | 19.49% | 15.91% | 12.83% | 3.99% | 3.50% | 3.78% |
The analyzed data indicate a notable decline in GMS Inc.'s profitability ratios over the period from July 2020 through April 2025, reflecting a downward trend in its ability to generate earnings relative to its assets, capital, and equity.
Starting with the Operating Return on Assets (Operating ROA), there was a marked increase from 4.49% as of July 2020, peaking at approximately 15.69% in January 2023. After reaching this peak, the ratio experienced a gradual decline, ending at 6.72% in April 2025. This suggests that while operational efficiency improved significantly in the early part of the period, particularly between 2020 and early 2023, the subsequent decline indicates reduced effectiveness in generating operating profits from the company's asset base.
The Return on Assets (ROA), a broader indicator of overall asset efficiency, followed a similar pattern. Starting from a low of 1.16% in July 2020, it increased to a high of around 10.33% in January 2023. Post-2023, there was a persistent downward trajectory, culminating at approximately 3.01% in April 2025. This decline signals decreasing overall profitability relative to total assets.
The Return on Total Capital (ROTC) exhibited the most pronounced fluctuations, with a significant rise from 16.76% in July 2020 to over 42.94% in October 2022, indicating highly efficient utilization of total capital during that period. However, after reaching this peak, the ROTC progressively declined, falling to approximately 14.26% by April 2025. The decline reflects diminishing returns on both debt and equity capital employed by the company.
Return on Equity (ROE) showed a relatively modest growth early in the period, climbing from 3.78% in July 2020 to a high of 27.13% in January 2022, indicative of improving profitability attributable to shareholders during that interval. Subsequently, the ROE decreased steadily, reaching approximately 8.13% in April 2025, implying that the company's profitability for equity holders has diminished considerably over time.
Overall, the trend across all profitability ratios indicates an initial phase of growth and improved efficiency up to early 2023, followed by a sustained decline. This decline may be attributable to various factors affecting operational performance, asset utilization, and capital efficiency, warranting further investigation into underlying causes such as market conditions, cost structures, or strategic shifts.