Lockheed Martin Corporation (LMT)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 12.55% | 12.56% | 13.52% | 13.23% | 13.99% |
| Operating profit margin | 12.59% | 12.65% | 13.61% | 13.22% | 14.29% |
| Pretax margin | 11.98% | 10.12% | 11.26% | 12.51% | 12.11% |
| Net profit margin | 10.24% | 8.69% | 9.42% | 10.45% | 10.42% |
Lockheed Martin Corp.'s profitability ratios demonstrate the company's ability to generate profit relative to its revenue. The gross profit margin, a measure of efficiency in production and pricing, saw a slight decrease from 13.57% in 2021 to 12.68% in 2023. This may indicate challenges in managing production costs or pricing strategies. The operating profit margin remained relatively stable over the years, hovering around 12.68% to 13.99%, suggesting consistent control over operating expenses.
The pretax margin, which reflects the company's ability to generate earnings before taxes, showed some volatility but generally declined from 12.59% in 2020 to 11.98% in 2023. This may indicate increasing expenses or declining revenue growth. The net profit margin, a key indicator of overall profitability, also experienced fluctuations, with a notable decrease from 10.45% in 2020 to 8.69% in 2022 before improving to 10.24% in 2023. This could suggest challenges in managing tax burdens and other non-operating expenses.
In summary, while Lockheed Martin Corp. has demonstrated consistent performance in controlling operating expenses, the declining trend in pretax and net profit margins raises concerns about the company's ability to maintain profitability in the face of potential cost pressures and varying revenue streams.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 16.22% | 15.79% | 17.93% | 17.05% | 17.98% |
| Return on assets (ROA) | 13.19% | 10.84% | 12.41% | 13.47% | 13.11% |
| Return on total capital | 37.36% | 29.57% | 35.88% | 49.60% | 54.33% |
| Return on equity (ROE) | 101.24% | 61.86% | 57.62% | 113.60% | 199.23% |
Lockheed Martin Corp.'s profitability ratios show varying trends over the past five years.
The operating return on assets (Operating ROA) has ranged from 15.86% to 17.88% during this period, indicating the company's ability to generate operating income relative to its total assets. The slight increase in 2023 compared to 2022 suggests improved operational efficiency.
Return on assets (ROA) has also shown fluctuations, with values ranging from 10.84% to 13.47%. This ratio reflects the company's overall profitability in relation to its total assets, and the upward trend from 2022 to 2023 indicates an improvement in this aspect.
Return on total capital has exhibited a declining trend, decreasing from 54.00% in 2019 to 35.28% in 2023. This metric represents the return generated from all sources of capital, including debt and equity. The decreasing trend may indicate a reduction in the efficiency of capital utilization or changes in the company's capital structure.
Return on equity (ROE) has been volatile, with values ranging from 57.62% to 199.23%. This ratio measures the return generated for the equity shareholders and the substantial fluctuations suggest changes in profitability relative to the equity investment value.
In summary, while the operating return on assets and return on assets have shown some improvement, the return on total capital and return on equity display more irregular patterns, indicating the need for further analysis to understand the factors driving these trends.