Masimo Corporation (MASI)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 48.86% | 51.05% | 65.24% | 64.96% | 67.09% |
| Operating profit margin | 6.65% | 10.13% | 22.26% | 22.37% | 23.59% |
| Pretax margin | 4.29% | 9.33% | 22.15% | 23.06% | 24.97% |
| Net profit margin | 3.97% | 6.92% | 18.53% | 21.01% | 20.92% |
Masimo Corporation's profitability ratios have exhibited a trend of decreasing margins over the past five years. The gross profit margin has decreased from 67.09% in 2019 to 48.86% in 2023. This decline indicates that the company's cost of goods sold has been increasing at a faster rate than its revenue.
Similarly, the operating profit margin, a measure of efficiency in managing operating expenses, has decreased from 23.59% in 2019 to 6.65% in 2023. This suggests that Masimo Corporation's operating expenses may have been rising relative to its sales, impacting overall profitability.
The pretax margin, which indicates the company's profitability before accounting for taxes, has also shown a downward trend from 24.97% in 2019 to 4.29% in 2023. This decline could be attributed to a combination of factors such as increased operating expenses, lower gross margins, and potentially higher interest expenses.
Furthermore, Masimo Corporation's net profit margin, a measure of profitability after all expenses have been deducted, decreased from 20.92% in 2019 to 3.97% in 2023. This suggests that the company's bottom-line profitability has been impacted by a combination of lower gross margins, higher operating expenses, and potentially other non-operating costs.
Overall, the declining trend in Masimo Corporation's profitability ratios raises concerns about the company's ability to maintain and grow its profitability in the future. It may be crucial for the company to address factors impacting its margins and efficiency to enhance overall profitability.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 4.49% | 6.54% | 14.62% | 14.94% | 15.84% |
| Return on assets (ROA) | 2.68% | 4.47% | 12.17% | 14.03% | 14.05% |
| Return on total capital | 6.19% | 9.21% | 17.72% | 18.75% | 20.08% |
| Return on equity (ROE) | 5.97% | 10.72% | 14.81% | 17.07% | 16.80% |
Masimo Corporation's profitability ratios have shown a declining trend over the past five years. The operational efficiency of the company, as indicated by Operating Return on Assets (Operating ROA), decreased from 15.84% in 2019 to 4.49% in 2023. This suggests that the company's ability to generate profits from its operations has weakened over the period.
Return on Assets (ROA) also decreased consistently, from 14.05% in 2019 to 2.68% in 2023. This ratio reflects the company's overall profitability in relation to its total assets, indicating a significant decrease in profitability efficiency.
Return on Total Capital and Return on Equity (ROE) have also experienced decreasing trends. Return on Total Capital declined from 20.08% in 2019 to 6.19% in 2023, while ROE dropped from 16.80% in 2019 to 5.97% in 2023. These ratios indicate that the company's ability to generate returns for both its investors and all capital providers has weakened.
Overall, the declining trend in Masimo Corporation's profitability ratios suggests challenges in generating profits from its assets, operations, total capital, and equity over the past five years. Further analysis and strategic measures may be required to improve the company's profitability and financial performance in the future.