Innovex International, Inc (INVX)
Profitability ratios
Return on sales
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 35.20% | 27.22% | 33.64% | 29.64% | 26.05% |
| Operating profit margin | 7.43% | 22.94% | 16.39% | 4.77% | -5.12% |
| Pretax margin | 21.61% | 3.18% | 15.61% | 4.64% | -17.00% |
| Net profit margin | 21.24% | 17.43% | 13.54% | 3.34% | -8.43% |
The profitability ratios of Innovex International, Inc. demonstrate a generally positive growth trend over the period from December 31, 2020, to December 31, 2024, albeit with some fluctuations.
Starting with the gross profit margin, there is a consistent increase from 26.05% in 2020 to a peak of 35.20% in 2024. This upward movement indicates enhanced efficiency in production and cost management, allowing the company to retain a larger portion of revenue after covering direct costs.
The operating profit margin reflects more variability, with a negative value of -5.12% in 2020, improving sharply to 4.77% in 2021 and reaching a high of 22.94% in 2023. However, it drops again to 7.43% in 2024. Despite this decline in 2024, the overall trend shows substantial improvement from the initial negative margin, suggesting that the company has been successful in increasing operational efficiency and controlling operating expenses over this period.
Pre-tax profit margin follows a similar pattern, starting from -17.00% in 2020, moving into positive territory at 4.64% in 2021, and peaking at 21.61% in 2024 after reaching a high of 15.61% in 2022. The sharp turnaround from negative to positive margins indicates improved profitability before tax, reflecting better overall operational performance and possibly favorable changes in non-operating income or expenses.
Finally, the net profit margin shows a significant recovery from -8.43% in 2020 to 21.24% in 2024. The steady increase suggests that after accounting for all expenses, taxes, and non-operating items, the company is increasingly retaining more profit relative to its revenue each year, with notable improvements in 2022 and 2023.
Overall, Innovex International, Inc. exhibits a trajectory of strong profitability growth, transitioning from losses to sustained profitability. The improvements across all profitability ratios point to effective cost management, operational efficiencies, and improved pricing strategies, although the slight decline in operating profit margin in 2024 warrants monitoring for potential margin pressures.
Return on investment
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 4.10% | 9.46% | 17.55% | 4.94% | -1.62% |
| Return on assets (ROA) | 11.72% | 7.19% | 14.50% | 3.46% | -2.67% |
| Return on total capital | 15.16% | 30.24% | 30.63% | 8.78% | -5.90% |
| Return on equity (ROE) | 14.65% | 22.48% | 25.18% | 5.46% | -2.95% |
The profitability ratios of Innovex International, Inc. over the period from December 31, 2020, to December 31, 2024, reflect a notable trajectory of recovery and subsequent stabilization following periods of loss.
In 2020, the company exhibited negative operational and net returns on assets, with Operating ROA at -1.62% and ROA at -2.67%, indicating a period of unprofitable operations. Similarly, the return on total capital was negative at -5.90%, and ROE stood at -2.95%, all signifying losses relative to shareholders' equity and invested capital.
By 2021, these figures improved significantly, with Operating ROA rising to 4.94%, ROA to 3.46%, and ROE to 5.46%. This indicates a transition from losses to profitability, driven perhaps by operational improvements or strategic adjustments. Additionally, the return on total capital turned positive at 8.78%, suggesting that the company was generating returns on its overall investments.
The most remarkable year appears to be 2022, when the ratios peaked markedly. Operating ROA surged to 17.55%, while ROA reached 14.50%. ROE also increased substantially to 25.18%, and the return on total capital climbed to 30.63%. These figures signify a period of robust profitability and efficient utilization of assets and equity.
In 2023, profitability remained strong, although slightly diminished from the peak in 2022. Operating ROA was recorded at 9.46%, ROA at 7.19%, and ROE at 22.48%. The return on total capital was still notably high at 30.24%, maintaining a high level of profitability relative to invested resources.
Entering 2024, there was a visible decline across all ratios, with Operating ROA decreasing to 4.10%, ROA to 11.72%, and ROE to 14.65%. The return on total capital also dropped to 15.16%, indicating a slowdown in profitability. Despite this decline, the ratios remained positive and substantially above 2020 levels, suggesting the company continues to generate profit but with diminished margins.
Overall, the company's profitability ratios depict a recovery from losses in 2020 to a peak in 2022, followed by a moderated decline in subsequent years. This pattern may reflect changing operational conditions, market factors, or strategic shifts that impacted overall earnings margins over time.