Jabil Circuit Inc (JBL)
Profitability ratios
Return on sales
| Aug 31, 2023 | Aug 31, 2022 | Aug 31, 2021 | Aug 31, 2020 | Aug 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 8.31% | 7.90% | 8.10% | 7.14% | 7.57% |
| Operating profit margin | 4.46% | 4.18% | 3.62% | 1.85% | 2.77% |
| Pretax margin | 3.66% | 3.69% | 3.23% | 0.95% | 1.78% |
| Net profit margin | 2.37% | 2.99% | 2.39% | 0.20% | 1.14% |
Jabil Inc's profitability ratios have shown some fluctuation over the past five years.
Starting with the gross profit margin, it has averaged around 8% over the past five years, indicating that the company has been able to maintain a consistent level of profitability on its production and sales operations.
Moving to the operating profit margin, there has been a gradual increase over the years, reaching 4.59% in 2023. This indicates that the company has been able to control its operating expenses more effectively, leading to improved profitability from its core business activities.
The pretax margin has also shown an upward trend, reaching 3.64% in 2023. This suggests that the company's ability to generate profits before considering tax obligations has improved, reflecting positively on its operational performance and efficiency.
However, the net profit margin, which accounts for all expenses including taxes, has fluctuated, reaching 2.36% in 2023. While this is an improvement from the previous year, it is still lower than the levels achieved in 2022 and 2019.
In conclusion, Jabil Inc has shown improvements in its operating and pretax margins, reflecting better operational efficiency and profitability. However, the net profit margin has been more volatile, indicating that the company may still face challenges in managing its expenses and tax obligations effectively.
Return on investment
| Aug 31, 2023 | Aug 31, 2022 | Aug 31, 2021 | Aug 31, 2020 | Aug 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 7.91% | 7.06% | 6.33% | 3.47% | 5.40% |
| Return on assets (ROA) | 4.21% | 5.05% | 4.18% | 0.38% | 2.21% |
| Return on total capital | 26.77% | 27.50% | 21.38% | 9.62% | 15.89% |
| Return on equity (ROE) | 28.54% | 40.64% | 32.58% | 2.98% | 15.21% |
Jabil Inc's profitability ratios provide insights into the company's ability to generate profits and manage its assets and capital efficiently. Let's analyze each ratio to understand the company's performance over the past five years.
1. Operating return on assets (Operating ROA): This ratio measures the company's operating income generated per dollar of assets. Jabil Inc's operating ROA has shown a consistent improvement over the past five years, indicating that the company has been able to generate more operating income relative to its assets. This suggests that the company's operational efficiency has improved steadily.
2. Return on assets (ROA): ROA measures the company's overall profitability by evaluating how well it uses its assets to generate earnings. Jabil Inc's ROA has fluctuated over the past five years but has shown a general upward trend. The increase in 2023 compared to 2022, despite the decrease in the operating ROA, may indicate an increase in non-operating income relative to its assets. However, the overall upward trend is a positive indicator of the company's ability to generate profits from its assets.
3. Return on total capital: This ratio indicates the return generated by the company from its total invested capital, including both equity and debt. Jabil Inc's return on total capital has consistently increased over the past five years, indicating that the company has been more effective in generating returns from the total capital employed. This suggests that the company's capital utilization has improved, delivering higher returns to its investors and lenders.
4. Return on equity (ROE): ROE provides insight into how effectively the company is using shareholders' equity to generate profits. Jabil Inc's ROE has experienced significant fluctuations, with a sharp increase in 2023 after a decline in the previous year. Despite the fluctuations, the 2023 ROE is higher than the 2022 level, indicating that the company has been able to generate better returns for its shareholders in the most recent year.
In conclusion, Jabil Inc has shown improvements in its profitability ratios over the past five years, indicating enhanced operational efficiency and better utilization of assets and capital. The increase in return on total capital and return on equity signifies the company's ability to generate higher returns for its investors. However, it's important to continue monitoring these ratios to assess the company's ongoing profitability and sustainability.