Ingersoll Rand Inc (IR)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 41.92% | 39.31% | 38.59% | 35.36% | 38.58% |
| Operating profit margin | 16.93% | 13.81% | 10.98% | 1.50% | 9.62% |
| Pretax margin | 14.82% | 12.75% | 10.49% | -0.55% | 8.53% |
| Net profit margin | 11.32% | 10.22% | 10.92% | -0.84% | 7.89% |
The profitability ratios of Ingersoll-Rand Inc have shown a mixed performance over the past five years.
Starting with the Gross Profit Margin, the company's efficiency in generating revenue after accounting for the cost of goods sold has improved steadily from 2019 to 2023, reaching 41.92%. This indicates effective cost management and/or pricing strategies.
Moving on to the Operating Profit Margin, Ingersoll-Rand Inc has demonstrated significant improvement in operational efficiency over the same period. The ratio has consistently increased, reaching 18.06% in 2023, reflecting the company's ability to control operating expenses while increasing sales.
The Pretax Margin, which indicates the company's profitability before taxes, has also shown positive growth trends. Ingersoll-Rand Inc's ability to generate profit before tax has improved steadily from -0.40% in 2020 to 14.91% in 2023, indicating effective management of expenses and increased revenue generation.
Lastly, looking at the Net Profit Margin, which represents the company's profitability after all expenses have been deducted, there has been notable improvement over the years. The ratio has consistently increased from -0.68% in 2020 to 11.32% in 2023, indicating that Ingersoll-Rand Inc has successfully managed its expenses and increased profitability.
Overall, the trend in profitability ratios suggests that Ingersoll-Rand Inc has made significant strides in improving profitability and efficiency in its operations over the past five years.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 7.48% | 5.54% | 3.73% | 0.37% | 4.19% |
| Return on assets (ROA) | 5.00% | 4.10% | 3.71% | -0.21% | 3.44% |
| Return on total capital | 12.01% | 9.32% | 6.98% | 0.98% | 13.93% |
| Return on equity (ROE) | 7.96% | 6.58% | 6.25% | -0.37% | 8.51% |
Ingersoll-Rand Inc's profitability ratios have shown some fluctuations over the past five years.
- Operating return on assets (Operating ROA) has steadily improved from 4.14% in 2021 to 7.98% in 2023, indicating that the company has been more efficient in generating operating profits from its assets.
- Return on assets (ROA) has also generally increased over the years, with a notable improvement from -0.21% in 2020 to 5.00% in 2023. This suggests that the company has been more effective in generating profits from its total assets.
- Return on total capital has also shown a positive trend, increasing from 0.81% in 2020 to 9.93% in 2023. This indicates that Ingersoll-Rand Inc has been able to generate better returns for its total capital employed.
- However, return on equity (ROE) has been more variable, with a significant decline to -0.37% in 2020 before recovering to 7.96% in 2023. This indicates that shareholders' returns have been more volatile compared to the other profitability ratios.
Overall, the improving trend in Operating ROA, ROA, and Return on total capital is a positive sign of the company's increasing efficiency and profitability, while the fluctuating ROE suggests a need for further analysis of the company's capital structure and shareholder value creation.