Generac Holdings Inc (GNRC)
Profitability ratios
Return on sales
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 38.82% | 34.79% | 33.85% | 36.73% | 39.05% |
| Operating profit margin | 12.51% | 9.84% | 12.60% | 19.47% | 19.54% |
| Pretax margin | 9.53% | 7.33% | 11.10% | 18.51% | 18.33% |
| Net profit margin | 7.37% | 5.47% | 8.89% | 14.86% | 14.30% |
Generac Holdings Inc's profitability ratios have shown some fluctuations over the years. The gross profit margin has decreased from 39.05% in December 2020 to 38.82% in December 2024, with some variance in between. This indicates a slight decline in the company's ability to generate profits after accounting for the cost of goods sold.
The operating profit margin remained relatively stable between 2019 and 2021, but there was a noticeable drop to 9.84% in December 2023, before recovering to 12.51% in December 2024. This suggests fluctuations in the company's ability to control operating expenses and generate profits from its core business operations.
The pretax margin also experienced a downward trend, declining from 18.33% in December 2020 to 9.53% in December 2024. This indicates a decreasing trend in the company's profitability before accounting for taxes, which could be attributed to various factors like changes in revenue, expenses, or other operational efficiencies.
The net profit margin followed a similar pattern, decreasing from 14.30% in December 2020 to 7.37% in December 2024. This suggests that Generac Holdings Inc's ability to convert revenue into bottom-line profit has weakened over the years, potentially signaling challenges in managing costs or enhancing revenue generation.
Overall, the trend in Generac Holdings Inc's profitability ratios indicates a need for careful monitoring and potential strategic adjustments to improve operational efficiency and boost 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) | 10.51% | 7.58% | 10.96% | 14.78% | 14.81% |
| Return on assets (ROA) | 6.19% | 4.21% | 7.73% | 11.29% | 10.84% |
| Return on total capital | 13.45% | 10.21% | 15.27% | 23.21% | 21.69% |
| Return on equity (ROE) | 12.68% | 9.17% | 17.70% | 24.87% | 25.22% |
Generac Holdings Inc's profitability ratios show a mixed performance over the past five years.
1. Operating return on assets (Operating ROA) remained relatively stable from 2020 to 2021 but declined in 2022 and further decreased in 2023 and 2024. The ratio indicates the company's ability to generate operating profits from its assets, with a slight downward trend in recent years.
2. Return on assets (ROA) followed a similar pattern, showing a slight increase from 2020 to 2021, but a significant decline in 2022, 2023, and 2024. This ratio reflects the overall profitability of the company's assets, with a noticeable decrease in recent years.
3. Return on total capital demonstrates a strong performance in 2020 and 2021, with a gradual decline in 2022, 2023, and 2024. The ratio evaluates the company's ability to generate returns for both equity and debt holders, showing a decreasing trend over the years.
4. Return on equity (ROE) also exhibited a decline over the five-year period, with a decrease from 2020 to 2024. ROE signifies the profitability generated for shareholders' equity, with a notable drop in performance in the later years.
Overall, Generac Holdings Inc's profitability ratios suggest a downward trend in the company's ability to generate profits from its assets, total capital, and equity over the years. This trend may warrant further analysis to identify potential factors impacting the company's profitability and strategies to improve financial performance.