Kenvue Inc. (KVUE)
Profitability ratios
Return on sales
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | |
|---|---|---|---|---|---|
| Gross profit margin | 58.29% | 58.04% | 58.19% | 57.49% | 56.52% |
| Operating profit margin | 11.98% | 11.81% | 12.25% | 15.89% | 16.43% |
| Pretax margin | 9.21% | 9.27% | 9.38% | 13.18% | 14.32% |
| Net profit margin | 6.70% | 6.91% | 7.32% | 9.78% | 10.88% |
Based on the provided data, let's analyze the profitability ratios of Kenvue Inc. over the five periods:
1. Gross Profit Margin: Kenvue Inc. has shown a consistent improvement in its gross profit margin from 56.52% in December 2023 to 58.29% in December 2024. This indicates the company's ability to efficiently manage its production costs and generate profits from its core operations.
2. Operating Profit Margin: The operating profit margin of Kenvue Inc. fluctuated during the periods, decreasing from 16.43% in December 2023 to 11.98% in December 2024. This suggests that the company may have experienced challenges in controlling its operating expenses or faced pricing pressures impacting profitability.
3. Pretax Margin: Kenvue Inc.'s pretax margin also declined over the periods, from 14.32% in December 2023 to 9.21% in December 2024. This indicates that the company's profitability before accounting for taxes has been decreasing, possibly due to lower sales growth or higher expenses relative to revenue.
4. Net Profit Margin: The net profit margin of Kenvue Inc. followed a downward trend, decreasing from 10.88% in December 2023 to 6.70% in December 2024. This indicates that the company's bottom line profitability, after accounting for all expenses and taxes, has been on a declining path.
In summary, Kenvue Inc. has shown positive performance in terms of gross profit margin improvement, but its operating profit margin, pretax margin, and net profit margin have declined over the periods. This suggests that the company may need to focus on cost management, operational efficiency, and revenue growth strategies to enhance its overall profitability in the future.
Return on investment
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 7.19% | 6.75% | 7.09% | 8.88% | 9.02% |
| Return on assets (ROA) | 4.02% | 3.95% | 4.23% | 5.46% | 5.97% |
| Return on total capital | 10.72% | 9.71% | 10.36% | 12.99% | 12.70% |
| Return on equity (ROE) | 10.65% | 10.00% | 10.99% | 14.04% | 14.84% |
Kenvue Inc.'s profitability ratios show a fluctuating trend over the periods analyzed.
- Operating Return on Assets (Operating ROA) decreased from 9.02% as of December 31, 2023, to 7.19% by December 31, 2024. This indicates that the company's operating profit generated per dollar of assets declined during this period.
- Return on Assets (ROA) also followed a downward trajectory, decreasing from 5.97% on December 31, 2023, to 4.02% by December 31, 2024. This suggests that the overall profitability of Kenvue Inc. relative to its total assets decreased over the period under review.
- Return on Total Capital exhibited a similar pattern, declining from 12.70% on December 31, 2023, to 10.72% on December 31, 2024. This ratio reflects the company's ability to generate returns from both equity and debt capital employed.
- Return on Equity (ROE) decreased from 14.84% on December 31, 2023, to 10.65% by December 31, 2024. ROE measures the return on shareholder equity, and the declining trend indicates a decrease in the profitability relative to the shareholder investments.
Overall, the decreasing trend in these profitability ratios suggests that Kenvue Inc. may be facing challenges in maintaining or improving its profitability levels over the analyzed periods. Further analysis of the company's financial performance and operational efficiency may be required to identify the underlying factors contributing to this decline in profitability ratios.