Ligand Pharmaceuticals Incorporated (LGND)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 27.16% | 20.64% | 25.74% | 19.68% | -2.01% |
| Operating profit margin | 8.95% | 1.52% | 36.03% | 21.26% | 946.41% |
| Pretax margin | 46.48% | 3.95% | 18.39% | -4.70% | 934.17% |
| Net profit margin | 39.10% | -16.74% | 19.83% | -1.69% | 737.94% |
The profitability ratios of Ligand Pharmaceuticals, Inc. have shown significant fluctuations over the past five years. Starting with the gross profit margin, there has been a general downward trend from 90.57% in 2019 to 91.99% in 2023. The company's gross profit margin reached its lowest point in 2022 at 73.08% but has been gradually improving since then.
Moving on to the operating profit margin, the company saw fluctuations with a significant decrease in 2019 (-2.36%) followed by a substantial increase to 28.47% in 2021. However, it decreased to 1.55% in 2022 and then improved to 7.48% in 2023.
The pretax margin also displayed variability, ranging from a negative figure in 2020 (-5.65%) to a significant high in 2019 (662.31%). The pretax margin in 2023 stands at 48.48%, reflecting a positive trend over the last few years.
Lastly, the net profit margin has been equally volatile with negative margins in 2019 and 2022 but positive margins in 2021, 2023, and a notably high 523.19% in 2019. The net profit margin improved to 39.72% in 2023, indicating a positive turn compared to the previous years.
Overall, Ligand Pharmaceuticals, Inc. has experienced fluctuations in its profitability margins over the past five years, but there are signs of improvement in recent years, especially in the net profit and gross profit margins. It would be essential for the company to continue monitoring and managing its profitability metrics effectively to ensure long-term sustainable growth.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 1.52% | 0.40% | 8.00% | 2.75% | 53.99% |
| Return on assets (ROA) | 6.63% | -4.37% | 4.40% | -0.22% | 42.10% |
| Return on total capital | 8.94% | 1.62% | 6.36% | 1.66% | 59.19% |
| Return on equity (ROE) | 7.44% | -5.58% | 6.96% | -0.42% | 82.02% |
Ligand Pharmaceuticals, Inc.'s profitability ratios reflect varying levels of performance over the past five years. The Operating return on assets (Operating ROA) shows the company's ability to generate profits from its assets solely from its core operations. The trend in Operating ROA indicates that the company improved significantly from 2019 to 2021, but declined in 2022 and 2023.
The Return on assets (ROA) measures the company's overall profitability relative to its total assets. Ligand Pharmaceuticals, Inc. experienced a volatile performance in ROA, with negative returns in 2022 and 2019, mainly due to lower net income compared to the total assets. However, there was a notable improvement in 2023, indicating effective management of assets to generate profits.
The Return on total capital indicates the efficiency of utilizing both equity and debt in generating profits. Ligand Pharmaceuticals, Inc. demonstrated a similar pattern as Operating ROA, with a notable increase in 2021 followed by a slight decline in 2022 and 2023.
The Return on equity (ROE) measures the company's ability to generate profits from shareholders' equity. Ligand Pharmaceuticals, Inc. experienced significant fluctuations in ROE over the period, with negative returns in 2019 and 2022. The substantial improvement in 2021 and 2023 suggests better profitability relative to shareholders' equity.
Overall, while Ligand Pharmaceuticals, Inc. has shown improvements in profitability ratios in certain years, the company also faced challenges in others. Management should focus on sustaining and improving profitability by efficiently utilizing assets and capital to enhance shareholder value.