MP Materials Corp (MP)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|
| Gross profit margin | 66.41% | 85.10% | 81.40% | 24.92% |
| Operating profit margin | -7.16% | 62.80% | 49.81% | -25.84% |
| Pretax margin | 13.37% | 65.44% | 48.26% | -29.38% |
| Net profit margin | 9.83% | 55.44% | 40.68% | -16.25% |
MP Materials Corporation's profitability ratios have shown significant fluctuations over the past four years. The gross profit margin, which reflects the company's ability to generate revenue after accounting for the cost of goods sold, has displayed a downward trend from 82.52% in 2022 to 63.42% in 2023. This decline may indicate an increase in production costs relative to revenue during the period.
The operating profit margin, which reveals the company's operating efficiency, has been volatile, ranging from -6.99% in 2023 to 62.14% in 2022. The negative operating profit margin in 2023 suggests that the company's operating expenses exceeded its operating income, impacting profitability.
The pretax margin, indicating the proportion of earnings before taxes relative to total revenue, has fluctuated considerably, with a significant decrease from 64.67% in 2022 to 13.05% in 2023. This decline could signal changes in tax liabilities or varying levels of operating income impacting pre-tax profitability.
The net profit margin, which reflects the company's bottom-line profitability, has also shown fluctuations, with a sharp decrease from 54.79% in 2022 to 9.59% in 2023. The negative net profit margin in 2020 (-16.25%) suggests that the company incurred a net loss during that year.
Overall, the analysis of MP Materials Corporation's profitability ratios highlights the company's varying levels of profitability and efficiency over the past four years, indicating the importance of closely monitoring and managing costs to maintain sustainable profitability.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|
| Operating return on assets (Operating ROA) | -0.76% | 14.63% | 8.75% | -3.23% |
| Return on assets (ROA) | 1.04% | 12.91% | 7.15% | -2.03% |
| Return on total capital | 1.87% | 17.42% | 10.04% | -4.03% |
| Return on equity (ROE) | 1.78% | 22.02% | 13.39% | -2.56% |
MP Materials Corporation's profitability ratios show mixed performance over the past four years.
The Operating Return on Assets (Operating ROA) has been inconsistent, with a significant decrease from 14.65% in 2022 to -0.76% in 2023. This negative trend indicates that the company's operating profitability relative to its total assets suffered a decline in the most recent year.
Return on Assets (ROA) also displays variability, peaking at 12.91% in 2022 but dropping to 1.04% in 2023. Despite this decrease, the company has generally managed to generate a positive return on its assets, signaling efficiency in asset utilization.
The Return on Total Capital metric has similarly fluctuated, with a notable decrease from 16.46% in 2022 to -0.87% in 2023. This negative trend indicates that the returns generated on total invested capital were insufficient to cover the cost of capital in 2023.
Return on Equity (ROE) also indicates variability, with a peak performance of 22.02% in 2022 and 1.78% in 2023. Despite the positive trend in general, the decrease in ROE in the most recent year suggests a decline in profitability relative to shareholders' equity.
Overall, the mixed performance in profitability ratios for MP Materials Corporation highlights the importance of monitoring and analyzing financial metrics to identify trends and opportunities for improvement in the company's profitability.