McKesson Corporation (MCK)
Profitability ratios
Return on sales
| Mar 31, 2024 | Mar 31, 2023 | Mar 31, 2022 | Mar 31, 2021 | Mar 31, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 4.16% | 4.47% | 4.98% | 5.10% | 5.21% |
| Operating profit margin | 1.27% | 1.58% | 0.77% | -2.12% | 1.08% |
| Pretax margin | 1.18% | 1.61% | 0.66% | -2.20% | 0.40% |
| Net profit margin | 0.97% | 1.29% | 0.42% | -1.91% | 0.39% |
McKesson Corporation's profitability ratios have shown fluctuations over the past five years. The gross profit margin has declined steadily from 5.21% in 2020 to 4.16% in 2024, indicating a decrease in the company's ability to generate profit from its core operations. The operating profit margin also experienced a decrease from 1.08% in 2020 to 1.27% in 2024, showing a slight improvement but remaining relatively low.
The pretax margin has fluctuated over the years, with a significant drop to -2.20% in 2021 before recovering to 1.18% in 2024. This indicates that the company's profitability before taxes has been volatile. The net profit margin followed a similar trend, reaching a low of -1.91% in 2021 before recovering slightly to 0.97% in 2024.
Overall, McKesson Corporation's profitability ratios reflect a mixed performance, with declining gross profit margins and varying levels of operating and net profit margins. Investors and stakeholders may need to closely monitor the company's operational efficiency and cost management strategies to ensure sustainable profitability in the future.
Return on investment
| Mar 31, 2024 | Mar 31, 2023 | Mar 31, 2022 | Mar 31, 2021 | Mar 31, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 5.80% | 7.03% | 3.22% | -7.75% | 4.06% |
| Return on assets (ROA) | 4.45% | 5.71% | 1.76% | -6.98% | 1.47% |
| Return on total capital | — | — | — | -78.57% | 10.21% |
| Return on equity (ROE) | — | — | — | — | 17.67% |
McKesson Corporation's profitability ratios have fluctuated over the past five years.
The Operating return on assets (Operating ROA) has shown a mixed performance, with a notable improvement in 2023 compared to 2022, although a slight decline was observed in 2024. This ratio indicates that McKesson has been able to generate operating income relative to its total assets, showing operational efficiency.
Similarly, the Return on assets (ROA) has also displayed variability, with a significant improvement in 2023 compared to 2022, and a subsequent decline in 2024. This ratio reflects the company's overall profitability in relation to its total assets.
The Return on total capital was not provided for the last three years, but it is worth noting the extreme negative value in 2021, which may indicate challenges in effectively utilizing total capital to generate returns.
The Return on equity (ROE) was also absent for the last four years, with a positive figure in 2020. ROE indicates the profitability generated for shareholders' investments.
In conclusion, while certain profitability ratios for McKesson Corporation have shown improvement in recent years, there have been fluctuations and some years with negative values, suggesting a varied performance in terms of generating returns on assets, equity, and total capital.