Grocery Outlet Holding Corp (GO)
Profitability ratios
Return on sales
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 30.24% | 31.28% | 30.52% | 30.81% | 31.05% |
| Operating profit margin | 1.79% | 3.17% | 2.65% | 2.89% | 3.43% |
| Pretax margin | 1.28% | 2.62% | 2.12% | 2.52% | 2.78% |
| Net profit margin | 0.90% | 2.00% | 1.82% | 2.02% | 3.40% |
Based on the provided data for Grocery Outlet Holding Corp, let's analyze the profitability ratios over the past five years:
1. Gross Profit Margin:
- The gross profit margin has shown a slight decrease from 31.05% in 2020 to 30.24% in 2024. This indicates a decline in the percentage of revenue retained after deducting the cost of goods sold.
2. Operating Profit Margin:
- The operating profit margin has also exhibited a downward trend, dropping from 3.43% in 2020 to 1.79% in 2024. This suggests that the company's ability to generate profits from its core operations has weakened over the period.
3. Pre-Tax Margin:
- The pre-tax margin declined from 2.78% in 2020 to 1.28% in 2024. This signifies a reduction in the percentage of income remaining after accounting for operating expenses and interest but before taxes.
4. Net Profit Margin:
- The net profit margin experienced fluctuations but ultimately decreased from 3.40% in 2020 to 0.90% in 2024. This indicates that the company's profitability in terms of net income generated per dollar of revenue has decreased significantly over the years.
Overall, the declining trend in all profitability ratios reflects challenges faced by Grocery Outlet Holding Corp in maintaining and increasing its profitability in recent years, which may require further analysis and strategic actions to address.
Return on investment
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 2.47% | 4.24% | 3.43% | 3.34% | 4.32% |
| Return on assets (ROA) | 1.24% | 2.68% | 2.35% | 2.33% | 4.29% |
| Return on total capital | 7.03% | 10.41% | 8.56% | 8.83% | 11.64% |
| Return on equity (ROE) | 3.30% | 6.51% | 5.86% | 6.17% | 11.57% |
The profitability ratios of Grocery Outlet Holding Corp based on the provided data show a mixed performance over the five-year period.
1. Operating Return on Assets (Operating ROA):
- The Operating ROA has ranged from 3.34% to 4.32% during the period.
- Operating ROA decreased from 2020 to 2021, experienced a slight increase in 2022, dropped in 2023, and then recovered in 2024.
2. Return on Assets (ROA):
- ROA fluctuated between 1.24% to 4.29% over the five years.
- There was a significant decline in ROA from 2020 to 2021, remaining relatively low in the subsequent years, indicating challenges in generating profits from the company's assets.
3. Return on Total Capital:
- The Return on Total Capital ranged between 7.03% to 11.64% during the period.
- There was a gradual decline in the Return on Total Capital from 2020 to 2024, indicating a decreasing efficiency in generating returns from the total invested capital.
4. Return on Equity (ROE):
- ROE fluctuated between 3.30% to 11.57% over the five-year period.
- ROE dropped significantly from 2020 to 2021, and continued to decrease in the following years, suggesting a decline in profitability relative to shareholders' equity.
Overall, the profitability ratios of Grocery Outlet Holding Corp show varying trends, with a general decrease in profitability over the five-year period. This may indicate challenges in effectively utilizing assets and capital to generate returns for both the company and its shareholders.