Granite Construction Incorporated (GVA)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 5.68% | 5.60% | 5.98% | 4.85% | 2.75% |
| Operating profit margin | 1.15% | 1.29% | 0.41% | -2.23% | -0.61% |
| Pretax margin | 1.06% | 1.46% | 0.49% | -2.05% | -1.05% |
| Net profit margin | 0.62% | 1.26% | 0.17% | -2.04% | -0.87% |
Granite Construction Inc.'s profitability ratios have shown a mixed performance over the past five years.
1. Gross Profit Margin: The gross profit margin has been increasing steadily from 6.43% in 2019 to 11.30% in 2023, indicating an improvement in the company's ability to generate profits from its core operations.
2. Operating Profit Margin: The operating profit margin fluctuated over the years, with a significant improvement in 2022, but a decrease in 2023 to 1.47%. This ratio indicates the company's efficiency in managing its operating expenses in relation to its revenue.
3. Pretax Margin: The pretax margin has shown fluctuations, with positive figures in recent years. The ratio improved from -4.67% in 2020 to 1.71% in 2023, reflecting the company's ability to control its operating costs and generate pre-tax profits.
4. Net Profit Margin: The net profit margin also varied over the years, with a notable improvement in 2023 to 1.24% compared to negative figures in 2020 and 2019. This ratio represents the company's ability to generate profits after all expenses have been deducted.
In summary, while Granite Construction Inc. has shown improvements in its profitability ratios in recent years, there is still room for further enhancement in operational efficiency and cost management to sustain and further grow its profitability.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 2.85% | 3.94% | 0.99% | -6.65% | -1.67% |
| Return on assets (ROA) | 1.55% | 3.84% | 0.40% | -6.10% | -2.41% |
| Return on total capital | 5.80% | 8.78% | 3.89% | -9.28% | -3.63% |
| Return on equity (ROE) | 4.46% | 8.74% | 1.04% | -14.87% | -5.27% |
Granite Construction Inc.'s profitability ratios showcase a mixed performance over the past five years.
1. Operating Return on Assets (Operating ROA): There has been a fluctuating trend in the operating ROA, with values ranging from -3.45% in 2019 to 4.47% in 2022. The ratio stood at 1.84% in 2023, indicating that the company generated $0.0184 in operating income for every dollar of assets.
2. Return on Assets (ROA): The ROA has also shown variability over the years, from a low of -6.10% in 2020 to a high of 3.84% in 2022. In 2023, the ROA was 1.55%, suggesting that the company made a profit of $0.0155 for each dollar of total assets.
3. Return on Total Capital: The return on total capital has been positive in recent years, with a notable jump from 0.02% in 2020 to 8.90% in 2022. In 2023, the ratio stood at 4.75%, indicating that Granite Construction Inc. earned a return of $0.0475 on each dollar of total capital employed.
4. Return on Equity (ROE): The ROE has also demonstrated variability, with negative values in certain years, such as -14.87% in 2021. In 2023, the ROE was 4.46%, showing that the company generated a return of $0.0446 on each dollar of shareholder equity.
Overall, the profitability ratios reflect a mixed performance for Granite Construction Inc., with fluctuations in profitability indicators over the past five years. It is essential for the company to focus on sustaining and improving its profitability metrics to create long-term value for its stakeholders.